Beer:thirty did not do a full hull extension--one could weld up a bracket which was a full extension. It looked as if the wooden extension had some issues with mounting the kicker, if you look at the photos. If you are a good welder, you would be better served by making a hull extension out of aluminum. Some armstrong brackets do give floatation, including the Tom Cat which gives some floatation. I agree with Tom's assessment, if you are going o put a modern 90 4 stroke, that you will want more floatation. As an engine is set back from a hull, it needs to be raised about 1" per foot of setback (without a full hull extension.
As for glassing in furniture and bulkheads--there is a right way, and wrong way. The right way is to put in any wood, or glass bulkheads, with foam between the hull, in a trapezoid form--even 1/2" thick is fine. The foam spacer is the thickness of the panel on one side and about 1/2 thicker on the side against the hull. You will spread out the attachment to the hull with progressively narrower layers of glass. For example the first layer will be 4" of mat, then 3" of glass cloth, and finally another 2 1/2" of mat. This avoids a "hard spot" on the hull, and spreads out the load.
But if you are going to use fiberglass, you have to either build or buy panels of fiberglass. This is not all that easy to do, but of course can be done. You need a table for lamination--and some "nonstick" on the surface--lay up a couple of layers, then a core--for example Nadicore is light and costs less than marine ply, then lay up the top layer of mat and cloth. When you join two pieces of glass, you have to radius the outside of the attachment, glass over it, and blend it in, then gel coat. A lot more work than wood is. But I have a friend who built a 63 foot power cat almost entirely by himself using this technique. It took about 12 years to do this working about 10 hours every day.
Using the Decraguard or any cored material (aluminum, or fiberglass), you still have to finish the area where the core is exposed--and want to avoid sharp corners (which can cause injury).
The question if removing the engine well will weaken the boat: If you bring the new transom--where you fill in the old cut out for the motor, up to the deck cap level, and cover this with fiberglass blended into the old transom, and then make a radius to the cap on the deck, to the transom (Make the cap of the deck at least 4" wide aft--and also leave about a 4" cap across the transom, there should be enough strength. There has to be several layers of glass--and I would be using some mat and roving--again you are going to have to learn how to do fiberglass work, and what is necessary. In my opinion, this is more difficult in many ways (including physical effects of fumes, glass fibers, having to wear a full suit and respirator), than simple wood working. But I have done both. I would not use aluminum to fill the transom notch, and then bolt it into the sides of the hull--this will put too much load on where the bolts are--you need to be spreading out loads, after you remove the splash well.
I don't know if the resale value of the boat is important to you or not. The quality and aesthetics of modifications, will have a profound effect on the future value of the boat. It may be harder to sell a boat which is modified.