Re: question #1, spraying KO on the cushions full-strength, then allowing it to dry - just spray it on to where it saturates the outer covering, then leave it there and don't do anything else - will help to some extent. Put the KO in a sprayer bottle like is used for Windex and similar products, then spray it on and allow it to soak in.
But it also wouldn't hurt to pull all the cushions out of the boat and leave them out on the deck on a sunny, breezy day, allowing them to air out thoroughly - kinda like hanging your wash out on a clothesline. If the smell has gotten into the actual "stuffing" of the cushions, KO will only help the situation marginally.
Re: question #2, use a wooden plug and stainless steel hose clamp? Better yet, why don't you just turn off the seacock at the through-hull, then remove the handle from the seacock, so it can't be turned on accidentally? That's what most sailors do.
Store the handle in your toolbox or somewhere where it will be available should you ever need it, but won't be still on the valve, where it could be turned on accidentally. To open it would require that the handle first be located, then re-attached to the valve, before the valve can be turned to the open position.