Cool boat...I almost bought that last year.
Have you done a compression check yet? If not, do it. A healthy stock 200hp merc should make between 115-125psi. Mine makes about 75psi, but that's besides the point.
If you don't know much history on the engine...and I imagine you don't since the boat had a Johnrude engine on it a couple years ago and the merc is a new addition, then start with the following:
Water pump impeller
thermostats
Lower unit oil
check all fuel lines, replace as necessary, and make sure all the clamps are nice and snug. I prefer the spring type clamps on these.
Does this boat have a throttle pedal and separate shifter or is it still using the original controls with the throttle/shifter all in one?
"soft" transitions into running like shit means it's fuel related...most likely the lines are degrading a bit and the clamps are losing tension...it doesn't take much for the pump to draw a wee bit of air at one of the fittings and lose prime temporarily. Mine does this on the first trip of every season. If it still runs like shit after sorting out the fuel lines, rebuild the fuel pump...kit is cheap, takes about 15 minutes.
If you plan on keeping it, get rid of the oil injection (merc has a kit...be sure you order the O-ring too since they decided not to include it with the dummy plug) pre-mix it.
Get yourself the Seloc manual on the engine. It's an excellent book and has all the information you'll ever need, including how to properly adjust the shifter cable.
Call me before you change the water pump...I'll tell you the easy way to do it. Order up a new anode too since it'll probably crumble when you take it off.
If nothing else works, sink it. Mine seems to have picked up 10mph since I pulled if off the bottom of the river.

Oh, and quicksilver oil is too expensive. Keep an eye out for Pennzoil premium plus or Pennzoil XLF...excellent oils, and you can get 'em for about $15/ gallon at walmart. Autozone had it on sale last weekend for $10/gallon, not sure if it's still going though.