Just sold a 1975 C27 this summer we owned for 12 years. We also had an outboard on the transom - Yamaha 9.9 from 2002. The PO built a teak doghouse on the aft lazarette hatch that accommodated the tilted motor. Always felt the un-reinforced transom was a little underbuilt for a 100 lb 4-stroke outboard. Nevertheless, really glad we could tilt the motor out between sailing as it really gunked up if left in the water, as we did on some occasions. Plus that means you may not be freshwater flushing it if in salt water. That's really important, and will eventually lead to a motor replacement in a relatively few years when it corrodes from the inside. I concur that the underway drag penalty for leaving it down is well worth it so you don't have to mess with it while underway. Different equation if you're racing though. We replaced an old Yamaha 9.9 early on in ownership and quickly realized very few 4 stroke 9+ HP outboards would fit the cutout in the transom - pretty much just the Yamaha. In fact, I don't think new Yammies will fit. And you're right, not a lot of room to enlarge the opening. I do see more than a few who completely dodge the problem by closing off the transom and adding a spring lift bracket on the stern.
Good luck with the boat. I found her a joy to sail and explored much of the central and northern Chesapeake bay with her.