I read magnesium is soluble in aluminum
is it reasonable to have one part of aluminum in contact with one part made of magnesium?
Would I have degradation of the magnesium part? corrosion? ...
Generally, when two different base metals are in contact (or close) with each other in the presence of an electrolyte, you can expect galvanic corrosion. The fact that one element is soluble in the other isn’t typically the cause of the corrosion.
Honda used magnesium covers on their aluminum motorcycle engines. The magnesium water pump housing on my 1987 CR250 is mostly built out of Red Hand now. The external covers held up fine but even small amounts of water in the gearbox from the water pump leaks caused pitting on the insides of the mag covers.