Well as I read the ad, the boat needs a long block AND manifolds. So ad another $4-600.00 on the cost of the engine. Depending on how mechanical you are, you might be able to find just a block and transfer the pistons, rods, cam, etc from the cracked block to the "new" block as long as the watery oil didn't get all around the engine. That wouldn't be good for anything.
Do a search on reman marine engines, I think Jasper is a pretty popular one. And if in fact the manifolds are cracked as well don't cheap out on aftermarket ones, get oem ones.
Do yourself a HUGE favor and go out to the iboats.com website. There is tons and tons of valuble info out there with lots of folks ready to help. Also, Volvo Penta parts a pleny on/through iboats.
If you pull the engine the outdrive will have to come off so you have your automatic U-joint inspection, and it would also be a good time to change the bellows.
My bets are the outdrive is fine.