35 is more than enough to push an SR4 along. Not maybe the "spend half the time airbourne" fast that some of the other Forum SR4 owners like, but will push it along nicely.
You may be surprised - if the Merc has PT and you are replacing bigger engine, it was around then that the Merc - Mariner - Yam triangle started to properly standardise....... you may find it bolts straight on. (but don't hold your breath!)
As for offset, at 35Hp you probably won't notice any difference. My old Suz 30 was dead centre.