Seems pretty steep to me! I'd probably just get a new long block and DIY. That way you know it will be done right. When you are talking about that kind of money, you could almost take a week off from work, do it yourself, and still be money ahead!
Not sure how it works in the boating industry , but flat rates in the auto industry have caused the quality of repair work to go in the toilet. My friend who has been a GM mechanic for 25 years tells me about the work he sees at the dealer caused by the mechanics rushing to make the repair because the time allotment is way too low. No attention to detail, lots of corner cutting, etc. my personal story on a close friends 6.0 power stroke would make you cry (that's a story for another time).
If you have the skills, do it yourself period. You will know it was done right and with care. That's not to say the dealer mechanics won't do a great job- the mechanics that worked on my M/C at the dealer did fine. i just think you take too big of a risk if you don't know the mechanic personally that will be doing the work.