Nothing wrong with running a 16tooth. It's easier on the clutch AND the output shaft. However, if you are at stock length, It's gonna wheelie ALOT easier. As far as the chain goes, it will depend on your ride height. If you have it so low that when you sit on it the swing arm is parrell to the ground, then when you're on the gas hard it will be travelling past parrell and when this happens the chain will be cutting into the chain buffer (the grooved rubber piece on the front of the swingarm) and eventually cut into the swingarm itself which will damage the chain and over time the swingarm.