Aluminum bike Chainstays block the chain please help

That looks doable to me. Flip the sprocket, should fix it, if not, judicious use of spacers and washers can work wonders. Once you get enough clearance, use a spring loaded chain tensioner to keep the chain from running sloppy.
 
I didnt give up! I think I finally won, with the suggestions that were given here.

Tried a few combinations of washers and nuts, and ended up using two nuts to push the side out just enough. Its pretty true and rides well. No kinks or noises, and its not hitting the chain at all.

Heres the pic:

IMG_20141108_142534.jpg


I had to adjust the brakes but other than that, its all good. The ride is smooth, and the tensioner lines up really well now. Thank you to everyone for the help. Im hoping that pushing that side out wont be any trouble in the future.
 
That's what I am talking about!

Now,you gotta look out for chainslap! If it starts doing damage,maybe you can use something like a thin layer of that fiberglass repair tape to act as a protector.
 
That's what I am talking about!

Now,you gotta look out for chainslap! If it starts doing damage,maybe you can use something like a thin layer of that fiberglass repair tape to act as a protector.

I ordered the engine kit from bikeberry. They sent me the 2 bolt tensioner instead of the 4 bolt that was listed. They also forgot the spark plug!
But I contacted them and they are sending me the 4 bolt, so as soon as I get it Ill put that one on the bottom and the 2 bolt on the top and I think I can take out one of the spacers.

Gonna flip the sprocket and do all the work at once, when the tensioner gets here tomorrow.

So far so good.
 
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