Jeff posted some more convincing math, and maybe he is right, but in my gut I was thinking the same as cousineddy. In rigging our racing boats, we are taught to concentrate all weight and rigging at the thwart, as close to half way between bow and stern as possible. Make-up “penalty” weight is added equally at bow and stern after failing a one-design weigh-in for the same reason, that’s where it hurts you most.
Assuming designers of turd cruisers like this were actually calculating their loading to this degree 50 years ago is likely giving them more credit than they are due, it is not inconceivable that moving ballast from the stern to the centerline may be an improvement in a boat designed with appearance and comfort taking precedence over performance.
A couple quick comments, you are correct that if the engine was actually located at the Center of buoyancy, or at least closer to the Center of Buoyancy it would potentially be less detrimental to pitching than it is in it's current position. In this case the problem is a mix of issues that only partially includes the position of the engine. What makes this a bigger problem than it might seem, is the sheer amount of weight. The combination of the weight and position would essentially be like having a small kid sit aft of the helmsman or the helmsman sitting a few feet too close to the transom in a dinghy. It would be noticeable.
I also want to address the comment that it is unlikely that the weight distribution was calculated when the Electra was designed. Even in the 1960's, when I was studying yacht design, one of the early steps in designing a boat was to prepare a table of weights which listed every known item on the boat including small items like cleats, chocks, stern lights etc., and which included a column recording their distance from a fixed point fore and aft and athwartship.
These weights were then totaled to find the dry weight without ballast. The ballast weight was calculated as the difference between the displacement and the weight without ballast.
Each weight and position was multiplied out and the rotational moment calculated. That was divided by the dry weight to give the designer the center of gravity without ballast. Then the center of gravity for the ballast was calculated adjusted and recalculated so that the center of gravity aligned with the center of buoyancy. That process was done both fore and aft as well as side to side.
When that was completed, additional service weight calculations were performed looking for the worst case with tanks full, crew in the cockpit, crew in the bunks, dishes in the cupboard, can goods in the lockers and so on to make sure that the boat when loaded mostly sat on her lines. There was an assumption was that owners would be aware of trim and adjust where they placed things to have the proper trim.
In wooden boats it was common to have 'trim ballast' which was internal ballast that could be moved to help trim the boat to her lines. In the mid-1960's Phil Rhodes told my Dad that the Vanguard was designed to carry roughly 10% of her ballast in trim ballast and was uncomfortable that the boats were delivered without the trim ballast.
I worked for the yacht designer Charlie Wittholz in the 1980's. Charlie worked with Carl Alberg at the Alden office and knew Alberg pretty well. Charlie was pretty much as old school as you get. Charlie's methods would have been similar to those of Alberg's who he worked with. Charlie always did a table of weights on his projects, even small catboats and canoe yawls. By the time that I worked for Charlie he was using an electronic adding machine to do his table of weights calculations rather than a slide rule and a mechanical adding machine, but he was definitely doing it.
In any event, the added weight of the engine would mean floating roughly 1 1/4" lower in the water and roughly 3 -4 degrees down in the stern (unless weight was added forward to counteract the rotation) and that additional submersion and rotation or counterbalance weight doesn't do anything good for the sailing abilities of a boat.
As I noted above, while the added weight of the engine and its position may not be the sole reason that this boat doesn't sail well, my sense is that it would certainly be a contributing factor which is why I would never have added it and might have removed it if I owned this boat.