short: I have been doing a lot of thinking about fuels, oxidizers, bypass ratios, bleed valves, and making use of enormous wings to get enormous lift. You may find yourself yawning already.
I stated previously I wanted an aircraft that was safe, should it thump a landing. As it's unmanned and small (when compared to even fairly small commercial passenger jets), this means the fuel has to be safe. I don't really like the idea of carrying JP-8 or JP-7 around with me, as I have seen JP-8 aircraft "thump" and explode into a large fireball. While I never saw pictures or evidence of JP-7 aircraft losses, at least a couple are mentioned, and they don't look real safe, either.
Interestingly, liquid hydrogen is a great fuel and could quite easily be purged deliberately from the vehicle, and it would certainly escape quite quickly from the vehicle, should it break apart. Extensive testing by P&W engineers found that it was hard to get LH2 to actually ignite, because it is so light and tends to disperse so quickly. If you consider the size of the aircraft, let us say a wingspan of 16', it almost sounds like the best route to work with (and in fact, the J58 and the "304" Suntan engine are — necessarily — very similar in operation) because you can't really keep too much in the wings, and the fuselage contains a lot of "open space" to keep it light. Even then, however, I'm not sure how much LH2 you'd be able to store and whether that would get you to San Francisco from San Diego (this is a common unit of measurement for Californians — how long does my commuter flight take? how much will it cost?).
While the primary problem with LH2 as a fuel is distribution (NASA has documented this extensively), but other obstacles, such as range and fuel containment in the vehicle, also crop up. (I am aware of the Rex engines; I intend to discuss them in a bit after I've digested exactly what they can do; so far it seems like the Rex 2 and Rex 3 were designed to be hammer-of-god fast, without much regard for fuel consumption)
Unfortunately, while methanol burns at 740° F or so (and is thus suitable for a liquid fuel), one of the other functions of fuel in many jet engines is lubrication. This is similar in concept to the 2-stroke piston engine. You guessed it, methanol is not going to cut it as a lubricant (come to think of it, I don't recall the specifics of the 304 Suntan engine's guts so I'm not sure what they used in their engine).
It seems that it may just be best plan to burn diesel, but keep my eyes out for other possibilities. In theory, anything that burns diesel well should be able to burn any of the alcohols. Lubrication has been partially solved by the use of ball bearings (even in axial-flow turbines!); in fact one such configuration actually uses gold-plated (treated?) bearings, which use the gold itself as a lubricant once the engine reaches sufficient temperature. Sure, it sounds great, but it's a lot of money, and while there are a few patents on these sorts of things, you have to try it in your own lab to determine whether it's right for your engine. This means you need to have lots of venture capital, or Uncle Sam must like you a lot. And those liquid-metal, ball-bearing turbojets? The really clever solution? Well, it's great if you never have to use it again, and all the engines with this sort of setup are part of a cruise missile of one sort or another.
On that last notion, it is kind of depressing to note that DARPA presently has very little interest in high-altitude, high-efficiency, or even long loiter engines. This says, to me, that they've pretty much got what they want in that regard. If that's the case, the principle of what to do with an air-breather that will fly above 100,000' comes down to two fields, neither of which will make anyone rich.
First, there are the sail planes (sometimes called power gliders). These are enormous wingspan glider-form aircraft, which people have affixed an e.g., TJ-100 to the fuselage. An example of this would be the air show crowd-pleasing Super Salto glider. The second, likely more far-fetched than a 100,000' "high altitude sailplane community," would be to get someone like Cirrus on board. Their Vision aircraft would benefit enormously from a higher-efficiency, smaller form factor engine. I could see an aircraft like the Vision equipped with two such engines attached at the fuselage much like the T-37 Tweet. I would imagine you could extend the range of the aircraft, give it a higher service ceiling, or even dramatically increase the power available to the pilot (without having to use an afterburner, but still very much at the expense of fuel consumption).
Would Cirrus be interested in building a twin-engine Mach 1.5-ish plane for commercial customers? My guess is probably not.