Bought a used 2004 Mercury package - Mercury 3.3hp outboard with a Mercury Airdeck 240 for under a thousand from a lucky winner of the package at a boatshow. The PVC boat has been great the two years I've used it.
Large tubes make for a dry ride. The inflatable floor and keel make for straight tracking. The package doesn't plane well, but its mostly used as a tender and cruising the anchorages.
We have a 26ft boat, the Airdeck 240 stores easily on the hardtop inflated and deflated in its bag. The engine fits nicely in a locker - snug and secure.
If we had a larger boat with a davit, then a 8 or 9.9hp would have been my prefernce for an engine on a 10ft Achilles RHIB - but thats sometime in the future.
Buy a dinghy suited for the boat you have, and the use you intend it for. Used dinghies and small engines sell when its time to upgrade.