What would the average cost be to replace the head gasket on a 496 HO?

Is it in the boat or out of the boat?? It will cost a lot.. The head bolts are not reusable and are expensive. In the boat I would guess 1500-1800.00

The the boat...

If one head gasket let go, you should be replacing both of them and doing a valve job and possibly springs at the same time.
Probably 3k or a little more.

Springs on a 496?

head gaskets is not a common failed gasket in a 496,,car or boat,, what does the oil look like?
you might want to flush out the coolant system and add oil dye to the oil ,,run the boat and see if you get and dye in the coolant bottle.

why does it need a head gasket?is the head gasket the root problem or a secondary one caused by something else?

Not sure it does need one... In the process of purchasing the boat and noticed the coolant tank was no longer clear and is much darker in color than the starboard tank.