Should the flyback diode have a "Maximum average forward rectified
current" above 2A, 200mA or 12A?
If PWM is applied using a single FET (not 'half-bridge') the diode recirculates current through the motor during the 'OFF' portion of the PWM cycle. Therefore it has to handle a peak current equal to the motor current. But how much will that be, and what about the average current?
As PWM ratio is reduced the ratio of motor current to power supply current increases proportionally. If the motor draws 2 A from the power supply at 100% PWM then at 99% PWM the diode must pass ~2 A, but only 1% of the time. At 50% PWM an average power supply current of 2 A corresponds to a motor current of 4 A. Half the time this current comes from the power supply, and the other half of the time it goes through the diode. In your case this means the diode would need to be rated for at least 2A average current.
However if the torque load reduces significantly at lower rpm then the motor current will also reduce, and the diode can have a lower average current rating. When driving a propeller or fan (which absorbs power proportional to rpm cubed) a maximum average diode current of ~0.25 A would occur at ~85% PWM.
In most applications (where lower rpm = reduced load) an average diode current rating equal to the rated motor current is more than sufficient.
If the motor is used in a basic on/off application (no PWM) then the diode only has to handle one current spike each time the motor is turned off. In this case a peak rating of 2A should be sufficient, and a 200 mA diode would probably be OK.
The MOSTFET I have is IRF520.
The IRF520 is rated for 6.5 A absolute maximum average current at 100 °C, which sounds like plenty. However at 2 A the typical voltage drop is ~1V (with 10V Gate drive), so it will dissipate ~2 W and need a heat sink. A FET rated for higher current should have lower loss and could possibly be used without a heat sink. To minimize heating and maximize voltage at the motor I usually aim for a voltage drop of 0.1 V or less, which requires RDSon <=50 mΩ at 2 A.