I have a dry stack system and that stack compartment in your saloon is huge. Before you rip everything out, have another look at it and see if there is anything else in there that is also using the space. It looks like it might be the principle vent for your engine room, which will need a replacement too.
I just had another look, you have a Detroit. There is a possibility there are two stacks in there with parallel mufflers that siamese into one before the upper deck stack. Detroits make a huge racket and you might find you are retrieving space at the sacrifice of relative quiet.
There is a fellow in our marina with a 48 Tolly with twin Detroits, water cooled and he can be heard approaching miles away.
Have a consult with a Detroit guy first?