All's "Well" that motors well....
FWIW....
Several boats designed in the late 60's/early 70's had motor wells similar to the Ericson 26-1, including the Cal 20 and 28, Catalina 27, and Ranger 24, and a scad of others I cannot remember offhand.
The neat thing was that the well put the prop deeper in the water compared to a bracket mount and also (in your case) put the thrust on centerline. Contributing to this mini-design-trend was the OMC company with their Johnson 9.9 Sailmaster (tm) outboard. This model sat very low on its clamp mechanism and had a very flat top to the case. It put the cylinders low, almost down behind the clamp area. Designers loved it and customers thought it looked cool.
Sailboat builders could have a low seat over a cockpit well.
Motors kept improving and changing and in the mid-70's the 4 stroke Honda hit the displacement hull market and even OMC changed their "look."
I would bet a penny that Mr. Crealock had this Johnson OB in mind when he designed your boat.
You might have to mold out a higher cover for the well to fit a modern engine. Others have done this on different makes of sailboat.
If the "hatch" will not close on top of your engine, this just might be the reason.
If I am wrong, just remember that the advise you get from strangers on the 'net is worth what you paid...
There should be some owners of sister-ships that can book in here with better information.
Best,
Loren