First and foremost, replace the transom and get it floating.
Don't get hung up on cheap. Focus your time and money on doing high quality work in one area at a time. The cost of good materials is very reasonable if you don't buy everything at once. Marine ply and epoxy are significantly more expensive than exterior ply and Bondo, but they are worth the cost IMO because of their increased strength and durability. There are some awesome composites out there, but the real world return on investment vs marine ply and epoxy is a frequent subject of debate here.
Make your deck height decision after you experiment a bit. Once it is in the water, throw a 2x12 across the bow where you propose installing the deck, stand up on it, cast a few times and see how unstable you feel. Use the same technique in the stern. After that, repeat the process while standing on the seats. You may find that while the decks flush with the sheer are too squirrelly, a deck built level with the seat tops feels pretty stable.
It looks to be a cool build. Have fun.
Nate