Mustangs...... I would get the oil tested before thinking of engine replacement, after all, you're talking in excess of 12k to replace the Westerbeke. The oil will tell you of any condition that may be going on internally which may warrent replacement. Do a compression test as well. I've got the same engine and after 30 years, she still runs strong.
The original wiring on my boat was pre-tinned stranded for the D.C. and solid copper for the A.C. You'll need to replace at least the A.C. with stranded, but the D.C. wiring may be adequate for you're loads if you keep things simplified. You'll need to at least upgrade the main panel to accomodate all the extras, and you'll need to increase the house battery bank if it hasn't been done yet.
The price of a re-fit on our T-37s is small compared to the price of the new
T-3700's!!!!
Good Luck, Tom