The 1 engine has a small carburetor, altered ignition timing and less chamber clearance along with a 1 pipe. The 2 engine has the larger carburetor as do all of the other versions along with corresponding 2 pipe. The 3 & 4 have just pipe & flex length changes.
The lower number of the engine, the lower the output & torque curve. The lower the output, the longer the life. These are very simple & reliable engines that give you lots of track time between rebuilds. I just removed one K2 engine for rebuild after 16 races this year. It still runs as well as the day I put it in service but want to make sure it continues to.
You will want to purchase the unit that matches your racing type but they can be re-configured to different configurations easily. They are a Cadet to Masters class engine as they easily grow with you.
I can easily recommend this engine. Get with a reputable engine builder & get one.