i did a repower on my 36 series 2 about 6 years ago. i went with the remanufactured cummins and i am very happy. I had to go with the 450 diamond (8.3) due to the weight of the series 2 but the 330 would work great in a series one 36. my installation cost was about 20,000 more or less. that included things like removing old engines degreasing and repainting the blilge new custom risers ( very expensive, the supplied stock ones are not nearly high enough) custom engine mounts, dripless shaft logs etc. since I was replacing big detroits I was able to use my existing electrical (batteries cables etc fuel delivery hoses and existing exhuast system. going from gas to diesel you will end up having to replace all that including possibly new shafts and props. what I am getting at is I dont know how you are going to get it done any cheaper and it could end up being Quite a bit more.
