The Volkswagen Type-4 engine was used between 1969-83 in the VW 411, 1972-79 Bus, Porsche 914 and 1980-83 aircooled Vanagon. The flywheel was held on to the crank with low-profile, external-hex bolts with serrated thrust surfaces that looked like this:
Under these bolts was a thin, one-time-use sheet metal lock plate that looked like this:
This plate had a dual purpose. The first to keep the bolts from backing out via the serrations which would bite into this plate–which is why the plate had to be replaced after just one use. The second function of this plate was to hold in a little felt pilot needle bearing sealing ring that would theoretically keep dirt out and grease in this bearing (#4 below), which is pressed into the crankshaft. This little bearing keeps the transmission input shaft supported and centered in the crankshaft. The whole thing goes together like this:
That little ring that is not numbered, right above the “5” is the aforementioned felt sealing ring, and looks like this:
The crankshaft, and the section of the flywheel that bolts to it, on a water boxer is identical to these air-cooled engines. But instead of external-hex bolts and that plate, VW switched to internal hex bolts and a little retainer to keep the felt “seal” in place, that all goes together like this:
It is perfectly OK to use the internal hex bolts in place of the external hex bolts. The external hex bolts were kind of “old school” and difficult to find, if you can find them at all. If you choose to use the internal hex bolts instead, you just need to make sure to address the pilot bearing sealing issue in one of these ways:
The original pilot bearing used on the T4 and water boxer is just a VW beetle bearing that has no seal:
It was originally used in the VW Type 1 (beetle) engine, built into the flywheel bolt (also called “gland nut”, only one bolt used on a Type 1 engine):
There is another, almost identical bearing that was used in other VW models, including the Vanagon diesels. It has a built-in, real rubber lip seal:
The problem is that it is a little bit taller to accommodate the seal:
In order to fit this bearing on a VW Type 4 engine or a waterboxer, you either have to modify the crankshaft hole so it is slightly deeper (what we do to all the crankshafts we use in all the water boxer engines we build), or modify the flywheel slightly to make room for the little bit of the bearing that sticks out of the flywheel.
So, that is the whole story, you can take it from here!