Moon,
I totally agree with disclosing known defects in a boat for sale. Whether or not it's legally required, I feel that it's just the right thing to do. That said, if there is a legal requirement in the United States to disclose faults with boats for sale, I'd really like to know, and to see the legal reference.
Whether I'm selling a car, house, or boat, the perspective buyer will know everything I know that's good AND bad about the item. And then the item is priced accordingly. Not to say that I haven't sold property that later had problems.
I once sold a car whose engine had major problems less than 2 weeks after I sold it. I wasn't aware of any problems with the engine when I sold it, but the buyer had a reasonable expectation that the engine should have lasted longer than what it did. I offered to pay half the cost of a new engine, including labor, and he was astounded that I did. He took the offer, and we parted on good terms.
I don't want a buyer to be surprised with defects in anything I sell. I tell them, I price accordingly, and typically everyone is happy.
Not what I've experienced as a buyer sometimes though, I'm sad to say . . .