Unfortunately the only place that could really handle a rebuild for the Mercury would be a fully equipped machine shop. Having said that, I don't understand why dealers always think they need to put in a brand new complete unit from Mercury.
If you check with places like Crowely Marine or other large marine dealers, you can pick up a rebuilt power head for around 3200. Still not cheap, but better than the 13-16,000 that a lot of dealers want to put in a "NEW" engine. Remember that you will have to pay labour to install the power head on top of that if you are not comfortable doing the work your self.
Aaron:cheers: