#1. From what I've read I my single 496HO 292 Islander is supposed to hold 120 gallons but I've never been able to fill it with more than 65 gallons before it pukes out the vent on the side (which also sucks while at the gas station BTW). On the gauge, full to 1/4 tank is always around 65 gallons. Is my gauge (factory Faria) way off or something? Do I have twin tanks to switch between?

#2. How do I pump out my waste water tank? I've been to several marinas and they all say they can't on my boat because of how my cap is made. My waste water cap is the same as my fuel cap from what I can see.

They are full of sh!t, same as your tank. They need to screw the adapter into the fitting. They are just lazy.
The folks' houseboat is the same way so it for sure can be done.
With the tank size, I'd suspect your gauge is off. Pull the floor cover in the walkway between the helm seats. There is a tag on the tank that will tell you the capacity.

My factory original tank and gauge would read empty and take about 35 gallons. I had to replace the tank and found that it was a 62 gallon tank! I had assumed it was a 40 gallon. Check the tag as J.S. suggested and go from there. Keep in mind that a old style sending unit is on a long arm, usually facing forward so it reads the level a foot or more in front of where it goes into the tank. If you are running a bow up attitude it will cause a reading that is way off.

Plow,

I know my boat will spit up like a baby if I fill it too fast before it is even full.

At full stream on the gas pump it will spit about out about a cups worth after 5-10 to ten gallons.

I have to go slow and then even stop and restart after a 5-10 gal. I know of other boat that does it too.

Thanks for the replies guys