Cracked head, water in the oil

[dippasan]

Good morning all.
Looking for some advice. We own a 23' larson bow rider with an MC 5.7 and Bravo 3 for our son's to use with their families when they come up. Great little boat. (No way they're using my boat).

My story:
I had that "holy $4it" moment during spring start up and discovered that wonderful milky colored oil in the crank case. I know it could be head gaskets or worse. I decided to dig into it last week. I removed the entire top end off the motor. Took the heads to a machine shop where magnafluxing revealed a cracked head. Head gaskets were junk also. The machine shop has a set of heads that have had a complete valve job ready to be bolted on. I think the lower end of the motor is ok but hard to tell. for that reason I'm willing to dump the $600 for the heads in hopes the lower end is ok. The boat is worth maybe $10k so it's hard for me to justify a $5-7k long block replacement. I'm trying to affect repair with minimal cost.

Do any of you have experience with a similar situation?
What's the best way to remove the water/oil from the crank case? Kerosene? Marvel mystery oil? Multiple oil changes? I'll try to get as much out as I can with my hand pump but it's pretty thick stuff.

Thanks in advance for your replies.