oVirt 3.5.1 RC1 will be published today so, if everything runs as expected, oVirt 3.5.1 will be out in a few days. oVirt 3.5.1 should solve the issue you reported.
Keep present that hosted-engine also installs and configures ovirt-hosted-engine-ha daemon to ensure HA capabilities restarting the engine VM if the host witch runs the VM goes down.
In the setup you are proposing you are loosing that capability.