Thank you will w.!
As for decals - I just googled and found a couple of places which, I guess, happened to be Marine stores who had such decals at the time.
I used Starcraft 1461250 White/Pacific/Blue as well as Larson 05729714 2008 and Larson 8639-0981 OEM Silver/Clear/Pewter 3/4'' decals, which we (with my wife) found to be the closest to the original modern Starcraft decals. The store who had the decals was 'GreatLakesSkipper', so I ordered from them.
Letters for the ship name and the fancy font letters for 'Islander 221V' (to preserve the style and to have the closest match to the original font) - I ordered custom letters from signspecialist.com. There you can shoose font, size, from huge variety of different fonts.
The total cost for all the decals was around $300.
I just had to reapply the strip decal on one side (it falled after the first serious trip: probably I hadn't cleaned properly), but after I reapplied it after good cleaning - it survived the summer. And now, after more than year and a lot of miles - they still there.
As for sanding, yes, I was sanding every layer, as required - both gluvit and epoxy. Any epoxy must be sanded - for the proper adhesion of the next layer or the paint.