Charter Woes

ON 7/4, JAG borrowed the boat for three days.  While he had her, two major problems occurred.  First, he had a leak in the hot water system.  Second, he was unable to start the engine on the third day, while anchored just outside Watch Hill harbor.
Troubleshooting:  the leak appears to have been at the high pressure cold water  input to the hot water heater.  JAG removed the fitting where the leak appeared and thought that it was missing a sealing washer.  I found an O-ring to see if that would stop the leak temporarily and delivered it to him while he was on the hook.  While he was installing it, the fitting rolled into the bilge under the engine, from which nothing can ever be retrieved, so the  leak repair had to be postponed.
I do not believe a sealing washer is required. I shall buy a new female 1/2-inch IPS to PEX adapter, and check if one is supplied.  I shall install the new fitting with appropriate precautions.
The cause of the engine problem was that both batteries were dead.  I brought two portable batteries to the boat, and it started quickly.  JAG brought the boat back to the dock, and set it to charge over the weekend, while both he and I were away.
I returned Monday evening, and found that both batteries were dead again, even though the shore power charger was still on.  The following  loads were connected: potable water pump, the instrument panel, and the bilge pump. None seemed active.  The battery #2 was selected by the BSS.  I checked the battery voltages directly, and they were: 8.9 VDC for #1, and 6.4 VDC for #2.  The analog battery voltmeter showed no voltage on either battery (its minimum is about 9VDC; its lamp was dim.
I set the battery selector to OFF, and turned off the automatic bilge pump.  All the battery voltages increased to about 11.0 VDC.  This was probably due to the shore power charging current.  When I shut off the charger, they went back  down dramatically.  I restarted the charger and am leaving it overnight.
First question: Are the batteries damaged?  Second: what drew so much current that the batteries died?
There are several problems in the DC system:  

• The DC supply to the inverter is not fused.  
• The Link 20 gets its power from Battery #1; it is unreliable if that is not good.  
• If the inverter failed, it could draw one battery dead, but how could it do both unless the BSS were set to both?  JAG says that was not the case.
• The generator is undersized.  the stock Westerbeke generator is 50 amps; Nigel Calder recommends  that the generator have the capacity to deliver the battery capacity in a quarter-hour (of course it can't, but that 's the size he wants).  Since we have two 200 A-h batteries (1080 CCA) batteries, we need to supply 100 amps.
• The charger is also undersized for these wonderful 4D batteries.  20A will not cut it.