If you like the layout of the Islander then you should also be looking at Pearson 28-1, Yankee 28 and 30 (not sure how common those are on the east coast), C&C 29 (the 30 is missing a quarter berth), Cal 29 and 31, and Islander 30s. There are more too, it is a pretty classic setup.
Sorry to hear about the condition of that one, online ads can be very misleading. I'm on the west coast and can't imagine how Sandy has changed the boat shopping market. I'm sure that many boats are being advertised with outdated photos now. I will say that many boats that we looked at were disappointing when we saw them in person.
Good luck with the search. The 9.2C is an interesting boat that gets tons of interior space in a 30' boat. You are giving up all outside storage though (it has no lazarettes), engine access isn't great, and it has a lot of windage from being tall. I've not seen one listed here for under $20k, but I think S2 boats are more common in the east than the west. I liked the concept a lot on paper, but looked at a couple in person and decided they weren't for me. I can see how it could be a good design for a family though. O'Day also made a 32' center cockpit boat that might be worth checking out if you decide that you like that design.
O'DAY 32 sailboat specifications and details on sailboatdata.com