Overhauling an engine every 2000 hours does not change that it is a 1960s design which relies on a very rich mixture and stupidly high octane fuels to not blow itself up to make what would today be very mediocre performance figures.

Rotax has some newer designs that are fuel injected, have modern piston head designs, and sometimes have turbochargers, and those represent what a "new" aircraft engine looks like.

While this is true, the frequency and ease in which engines are swapped does allow the potential for innovation to creep into the space. We’ve made ICE engines smaller and more efficient over the last 3/4 of a century - but the FAA doesn’t seem to car about GA and likely won’t let anything innovative into non-experimental aircraft, which is a shame. Their argument is always safety, but we have ways to test for that and most of the GA engine designs we still see are from an era where they were not as concerned and were effectively grandfathered in.