[Others chimed in before I finished typing....but here it is anyway...]
You seem to be having fun! Glad to see you've wriggled out of the grasp of the heat demons (at least temporarily). Here are a few comments:
1) When you start cutting things a bit close, you need to take into account things like the fact that mains voltage isn't always on spec; sometimes it's less, sometimes it's more. Your 18VAC may be a bit higher making your drop a bit larger. I used 10% in my calcs, just to be safe. Even 5% gives you a 26.8v drop * 2.5 A = 67Watts / 2 = 33.5 W * 4C/W = 134C + 30C = 164C/175C = 92% of spec. That's far too close for my comfort. There's a general rule of thumb that says for every 10C drop, you double the lifetime of the component. The mfrs don't spec *lifetime* at Tjmax, so you're kinda guessing on that one. But as I indicated before, I try to run my devices fairly cool.
2) You're talking about running mosfets in parallel. It *can* be done, but you're wandering into a bit of a snake-pit. Just from the point of view of heat (that is, leaving aside the issue of controlling them in a feedback loop), the problem is that below a certain threshold they *don't* share current equally (I had forgotten this until Kleinstein mentioned switching vs. linear mode back a few replies). The explanation can be found here:
http://www.infineon.com/dgdl/Infineon--AN-vNA-NA.pdf?fileId=db3a30433e30e4bf013e3646e9381200(if the link doesn't work, go to Infineon's website and search for "AP99007")
Still, HP ran 4 IRF440 in the 3610 with no resistors (that I could find in the schematic), so maybe with enough derating it isn't as hard as it seems.
Edit: oops, found them. 10 ohms, but only one resistor per *pair* of FETs.
Anyway, let's do a heat calc in reverse, assuming a max jct temp of 175C and assuming you don't run it at more than 150C (86% of max--still pretty high...):
150C -30C (ambient) = 120C / 70W (round numbers) = 1.7 Rtheta (total) C/W - .5 C/W (Rtheta device) = 1.2 C/W Rtheta heatsink. I did a quick digikey search (US) and about the cheapest I could find was $15.
So now you need to find an n-fet that:
1) Has a Tjmax of at least 175C
2) Handles 300W (which is an indirect way of finding one with an Rtheta of 0.5C/W)
3) Doesn't have much more than about 3000pF of input capacitance (more on that later)
4) Has a SPICE model you can get your hands on
(4) is tough...and you definitely want to be able to sim them. I did a quick search and didn't quickly find one that I could find a spice model for. The 175C reduces your selection by quite a bit, but that's kind of forced on you because of your volts*amps decision.
Without trying to push you in a particular direction, I did the following calc:
150C Tjmax running at 125C (83%) - 30C (ambient) = 95C / 1.7C/W total Rtheta = 56W = 25V * 2.24 Amps. That's not much of a reduction in your volts/amps envelope.
Or....you could use a CPU cooler (with a fan) ....really good Rtheta and small ones are cheaper than big heat sinks....
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Now about that input capacitance...
I won't try to go into chapter and verse here, but mosfets have capacitance built into them, some more than others. Very roughly speaking, the bigger the die, the more the capacitance. OK, pick one with a small die, right? You'd like to, but heat dissipation (Rtheta) is proportional to die size! So, if you want to be able to handle a lot of power, you end up with a bigger die which means more capacitance.
So what's the big deal with capacitance? One way to look at it is that it slows down the response of your feedback loop. A slow feedback loop means that things get out of whack for a longer time (thereby being more out of whack) before the control mechanism can catch up and correct the situation. It also makes it harder to create a compensation network for the opamp because it creates a low-frequency pole (or moves an existing one further down in frequency). Finally, if your PSU has (or will have) a "mute" or output enable/disable switch, then you can get a big spike at turn-on if the fet has a lot of capacitance.
If capacitance weren't an issue, you could just go for a super-low Rtheta and be done with it. Sadly, it is an issue.
--Steve