Everything is in Volvo's hands right now. My dealer has done a bunch of inspection and sent pictures and info to Volvo. He has also found more corosion on the pivot housing that I did not see.
I mentioned your case to my dealer, and how it was resolved, and he is agreeing that it is starting to look like a paint defect as well.
Unfortunately Dave, I can't use your Volvo contact (that you sent in your PM) in the U.S., as the warranty/complaint department from Canada is a different entity.

So far my dealer has been on top of the problem, so I am going to leave it to him. Having said that though, I am going to mention to Mike (my dealer and the owner of the dealership) if he thinks I should call Four Winns or just leave it to him. I trust him on this one; he is a friend and has been taking care of my family members for years.
So, right now it's the waiting game. If you don't mind Dave, I would like to bring your pictures in to show my dealer for a comparisson, if that is alright with you? I am going to pick up the boat tomorrow morning so that I can put it in winter storrage (it has been cold enough up here to snow the last 2 nights; quite a difference from the 20+ deg C weather we had here last week), and whatever is going to be done to the drive will be waiting until the spring.
Keep your fingers crossed for me everyone!
Cheers