Ayrity - you'll need an electric motor of higher horsepower than the motor you wish to test. And like I said, an old stove provides 4 variable controls for resistance that are designed to handle higher power levels and you have 4 heat devices and could easily add more in parallel to offset the voltage difference and get the resistance low enough to allow enough current to flow.
An alternator might work, but you'd need a self-exciting alternator or at least one with enough residual magentism to be self-exciting, otherwise they need an external power source. And it would need to be a large one, an old 60A variety only outputs just under 1hp so even if its efficiency is poor its a stretch to be a full 5hp load.
Yes, if you had the engine under test connected to the electric motor as its load, and RPM was steady, then its an equal torque on either unit. So the engine is fixed (for ease you just bolt it down) and the load unit is pivoting. If you use a 1ft long torque arm and measure the force needed at the end of it to prevent rotation of the load unit, that's your torque.
An inertia dyno like a dynojet is really just a super large flywheel. The flywheel's ability to store rotational inertia is expressed as a term "moment of inertia" or to avoid confusion the term is sometimes specified as "rotational moment of inertia" to avoid confusion with bending. Think of a cantalope and a bicycle tire - spin them up and the bicycle tire will resist being stopped or started in motion more than the fruit. Even if they had the same weight on a scale, the distance that weight is from the pivot point makes a big difference. Grab one end of a hammer and swing, now grab the other end, same idea. Its not just the mass, but where that mass is in relation to the center of rotation.
Since it takes a lot of energy to spin up a big flywheel, you can derive the force needed to spin up that flywheel with respect to time and therefore the power as well.
This works in the opposite too, that's why racecars will have a lightened flywheel, its not just to lighten the car but to also reduce the horsepower needed just to spin up the engine and instead allow that horsepower to be transmitted to the ground.
There's benefits to both methods too long to list here. Controlling the test conditions is going to be the most important, it seems the correction factors used and the sensors are the biggest complaint you'll find, especially with the inertia dynos. They are so easy to use, those details are overlooked and when 1% or 2% gains are being marketed the lack of tight control over variables really makes the results questionable.
But if you have an accurate means of determining barametric pressure (an old altimeter retired from service from a Cessna or something) and a wet/dry bulb thermometer to measure temp and humidity, and a SAE correction factor to STP then you could measure reasonably precise data for not a lot of money.
