Good news and bad. You certainly have an item to use to negotiate a price break. Chances are the pedestal needs a paint job and the cables replaced anyway. Cables are almost never replaced and should be about every ten years.
Given that this is the cockpit sole it has a bunch of non skid I would try to confine my repair to that area. I would take my dremel vibratory saw and cut through the top layer just inside the non-skid by an inch or two to get an handle on how bad it is. Hopefully it is mostly around the pedestal. Lift off the fiberglass as one piece, remove rotted core, replace rotted core, replace sheet of fiberglass. Grind down about two inches all around the cut, seal it back up, then apply some kiwigrip non-skid paint in a color matching the existing non-skid color.
Sounds tough, but it is probably about 4-6 days of work (quote is consistent with this...5 days x 8 hours x 150 hour = 6K). One to pull the pedestal, one to cut everything up, one to put everything back, one to kiwigrip and one to put the pedestal back.
You can probably split the job up too. Pull/replace the pedestal yourselves and do the kiwigrip yourselves. Just pay the shop to do the fiberglass work, or reverse it if you are comfortable with the fiberglassing but not the mechanical stuff.
This stuff isn't atypical. I bought me boat knowing it has some wetness around the chain plates, mast step, etc...but all were not catastrophic except the damage to the bulkheads from the chainplate leaks. When faced with it, the owner offered to do the repair to my specifications. I had Peter write up what had to be done and had the owner photograph the whole process to document what was done. The owner did a great job. It is viewable in the knowledge resource.
On the other hand, my Wife and I doubled our boat budget to get our S2 in comparison to the first boats we looked at because she knew I didn't have time for a huge project.
However, I ended up with one anyway as I got some bad advice and decided to pull the shaft to replace the cutless bearing, which in hindsight was probably unnecessary. It was very good experience though and the whole experience proved to me that working on the boat is a part of owning it. The smaller the boat the less work there is, so I caution you that moving to 28 feet is a big commitment in terms of the complexity of the boat/systems and you will be faced with repairs.
If it helps, I suggest you post a list of the other little items the survey came up with so we can chime in on whether the whole laundry list is a problem.
Did you go with Peter for the survey? I hope whomever you used checked the fuel tank for leaks, if it aluminum, because that is a pretty common issue.
Bob