One of the rules of thumb in the resto world is that typically, you need one of two things, a solid usable hull with a bad drivetrain, or a rotten hull with a solid usable drivetrain. In your case we know the hull is rotten, so you need to work on the drivetrain first to try to determine if its usable. Whenever I see an upper gear box thats been swapped, I can't help but wonder if it was shimmed properly when installed or if it was just thrown on. None of the outdrive is original, except perhaps the transom shield. Also, since it is a rebadged Volvo outdrive, the motor will not have volvo parts. Well it may have some, but Volvo only used the 302 for two years in the mid seventies. the 302 was know as an AQ190. Most parts for those are NA. So...marine specific engine parts may be hard to come by. There were a number of companies rebadging the volvo outdrives and installing their own motors back in the early 70 including glastron, chriscraft, chrysler, etc.
If it where mine I'd start with going through the drivetrain and getting it functioning first, while its still in the boat.
1. Drain the outdrive oil and Pull off the upper gear box to inspect the inside of the outdrive. Attached is the procedure for that, oddly called Outdrive pin removal.
2. Get the motor running. You can do this with the upper gear box removed. Once running a compression check would be my next move.
I wouldn't do any other resto work until these are done. We'll be happy to help you with any of these things as you work through them. Good luck!
