Transom Swells about half an inch

[billfish16]

The Transom on my 1982 V20 swells about 1/2 inch when it goes in the water in the Spring then shrinks back 1/2 inch over the Winter while covered on land. The Sheet Metal Cap on the Transon Cutout that is on either side of the OB is stretched out and does not appear to shrink back to what was the original thickness. I am going to take that sheet metal cap off and at least cover it back up with a new sheet metal cap, lots of 5200 and or fiberglass. I have drilled a few holes in the transom over time and used lots of 5200 in the holes so I do not think water is coming in from them. Anyone one know what I should be looking for when I take that cap off, other than wet rotton wood? How do you know if it is repairable vs replacing the entire Transom? Do I just re-cap it and use the boat until the engine falls off?

Thanks in advance for any insight.

Billfish16