As usual, Maine offers good advice. The price of Volvo parts rules them out to me. back in the 90's I spoke to the Volvo dealer at the boat show about parts prices. 0.30 over pistons for a small 4 cyl. were $500 EACH
back then, when the whole engine was about $10K new. Outrageous and a clear explanation of why Volvo lost the small boat market that they once "owned".
By way of comparison, a set of 8 high performance 0.30 over pistons for a Chevy engine cost me $175 at about the same time.
Saildrives are also a deal killer. A keel re-set isn't that big a deal although it requires heavy equipment and takes time. I'd do it again if the price was right.
An engine is a far more complex decision. If it's rebuildable and you can do the rebuild yourself over the winter, it can be an extremely satisfying experience. You can get a new engine and better yet - a new engine compartment
for not much money. Doing an A4 particularly is a job any mechanically inclined person is capable of. A big 4 cyl. diesel is another matter but still doable, particularly if you know an experienced person who will babysit you through it.
Swapping in like for like is fairly simple but time consuming - I did this with a one lung Yanmar (YSE8 out & YSM8 in for those in the know) and it took 5 weeks of spare time.
Swapping in a different engine can be a nightmare, particularly if you have "typical" sailboat access conditions. For boats with good access, like under the main cabin sole or table, it can be no more trouble than a "like for like" swap but in a boat where the engine was installed under the cockpit before the deck went on? Fugeddabatit.
As an example - My first engine swap was in a car. It was a chevy engine into a Buick wagon. Versions of that model came with both so I was able to use factory parts for most things but it was still a huge PITA. The accessories like starter, fuel pump, alternator etc. were on opposite sides so the wiring, fuel lines and so forth had to be custom made. The flex plate and torque converter used different bolt patterns, luckily the transmission had Chevy and Buick bolt patterns so it bolted up but otherwise? New trans.
It took all my spare time for two weeks in a hoist equipped shop to complete. Doing it or something similar in a typical sailboat doesn't bear thinking about.
Note: all the above is predicated on the owner enjoying serious boat work. If you only want to go sailing, ignore it and listen to Maine.
As to horsepower requirements - Skenes has a very detailed calculation for determining these, but it's old and probably doesn't meet modern requirements. In the G.O.D.'s, two ponies per ton was the rule of thumb. In the 70's that increased to four per ton and now, with big alternators and all the modern electrical req's I think five per ton would be more like it, even though the boats are slipperier and the props are better.
Incidentally, continuous rated shaft horses is the standard for this comparison in my experience, not max output or "at the prop" or any other method. As long as it's like for like, the comparison is valid.