My sincere thanks to Bob, Stringy and Paul for relaying all the information, and for taking the time and effort to respond to my problem.
Stringy: Reviewing viewtopic.php?f=75&t=3513
was extremely helpful, especially the two solutions submitted by Keith. I remember it now but at the time I just didn't "connect the dots" as to what was happening with my boat.
Paul: Excellent demonstration video! http://www.youtube.com/watch?v=lPfhDDOa2-0
I just wish I'd seen it before I went through the same shenanigans as you did. I never thought to look (inside) a threaded pocket for a crack, but I certainly will in the future. Switching to a Eye Fitting was pretty clever as well.
I've not yet had a chance to test my repair while sailing. In the meantime I did run some water over the top, and didn't see anything dripping down through the pocket. However, the silicon I used (see my 3rd photo.) didn't stick to the outside walls. I may have to redo my original repair - we'll see.
Other than Matt M., the only response I got from Hobie was the following from a Hobie Tech: "THERE ISN'T ANYTHING TO DO ON THAT – SOMETHING THAT MINOR ABOVE WATERLINE WE WOULD JUST HAVE THEM REPAIR ANYWAY – WHICH THEY'VE ALREADY DONE IN A WAY –"
"IF THE BOAT LEAKS – I DOUBT THAT WAS THE SOURCE – IF THERE IS SOME OTHER ISSUE WITH THE BOAT IT WOULD NEED TO BE DISCOVERED AND ADDRESSED – THAT SIMBUT FITTING CRACK ISN'T A SOURCE OF ANY SORT OF LARGE CAPACITY LEAK"
Silly of me to have worried about this "minor" problem. Apparently a gallon or more of water (somehow) getting through a hole in the front of my boat, inches above the waterline in the Atlantic Ocean is no biggie - I'll just have to keep looking for the real "source". (I guess the Hobie Tech's are too busy doing "technical things" to watch Paul's Youtube video).
The insert areas are "outies" in the mold, so typically raised areas are thinner. Plastic forms thicker in low areas... these are like little lumps and the plastic naturally flows off of them easily. I have not seen one of these become a structural issue. More cosmetic.
With all due respect, identifying inserts as "outies" is not the issue. The only issue is that the sidewalls in question on my boat were way too thin to accept threading in the first place. A hole was created when the insert was cut completely through the plastic wall by someone assembling the boat. Then rather than trying to fix or reject it at that time, an End Fitting was installed and 2 1/2 years later I finally discover this defect, and the source of my leak.
If a boat leaves your factory and takes on water due to insufficient Quality Control Standards and manufacturing defects, it is most definitely a "structural", and not just a "cosmetic" issue.
Obviously I will try to make the best repairs to my boat and hopefully solve this problem for the long term. As Matt say's, I at least have a record of the problem now. My only regret is that I didn't discover this defect when I first purchased my boat and submitted a warranty claim at that time.