I have to side with trying to fix it. Detroit Diesels parts are cheaper than most and have a lot of after market makers.
The mentioned water. One of the problem with Detroit Diesels is they have steel Pistons that are plated (or if it has Cross Head Pistons the Piston Skirts are Aluminum and the Heads are Steel). If the water gets into the cylinder from sitting out in the open they eventually rust to the cylinder.
The good news is that the Cylinder Liners are slip fit into the block bore. It is possible to remove a Cylinder Liner with the Piston/Connecting Rod still attached.
Any way it will cost you nothing but your labor to take a look.
A lot of Detroit Diesel Gen Sets are used by the Military; yours may be one of them. Also they have web sites for things like Military Trailers and other such things they may even have some sites for the Gen Sets.

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84 300D, 82 Volvo 244Gl Diesel