Zimirken,
1. Peerless Gear transaxles can be run with the input shaft in a horizontal position with the axle towards the bottom, cluster gears up. This does not normally create a lubrication issue, but it probably wouldn't hurt to add 6-8 oz. of Lucas Gear Oil Additive.
Gear oil doesn't work well with the 801s because they are not made with lip-style seals, just O-rings, and will leak gear oil during normal operation. You'd have to modify the case to accept lip-style seals like the MST 200s use with gear oil.
2. Corvairs have been doing this since 1959, and are still doing it. This is the easiest way to solve your problem, as long as you align the pulleys correctly. Find someone in your area with a Corvair and study the pulley alignment.
3. Peerless already offers right-angle gearboxes. Get one off a boneyard commercial walk-behind mower deck.
4. This would be the best but most-expensive solution, except that the outer end of the shaft on the right side rides in a bronze bushing. You'd also have to modify the case to fit a ball or needle bearing to support the end of the shaft. Unless you'd want to extend the left end of the shaft, which already rides in a ball bearing. With a belt-tension load, though, you'd probably need a double bearing.
Respectfully,
Rodney