Upgrades to the 125VAC Electrical Power System
When I purchased Sarah in 2000 it was wired for 125VAC 60Hz shore power.  The AC power system consisted of a deck receptacle on the aft cockpit coaming, a distribution/breaker panel integrated with the 12VDC panel above the navigation station, eight (8) power outlets in the 3 cabins, plus an AC-powered Air Conditioner, refrigeration, hot water heater and battery charger.  Many of these AC devices have been replaced or upgraded over the years, but the AC wiring has not been changed a great deal.
Isolation Transformer
My initial change to the shore power wiring was the installation of a Mastervolt isolation transformer in 2005.  The transformer was installed to allow Sarah to be connected to the 230VAC 50Hz mains power available in Europe.  I have described the installation and operation of the isolation transformer in the European Shore Power Plan webpage.
This transformer is a multi-port unit, that is it can be either a step down and isolation transformer (230VAC to 115VAC) or just an isolation transformer (230VAC to 230VAC or 115VAC to 115VAC). 
I never used this unit with a high load (>20A at 125VAC) before departing for Europe.  In Europe it worked flawlessly, but still the load was norally less than 10A at 230VAC.  I did use a space heater over the two winters in Europe, but it was a 230VAC appliance and used a circuit that bypassed the transformer.
When I returned to the Chesapeake Bay in 2007 I was back on 125VAC without any heavy loads until that winter.  Then I needed a space heater, which brought the input load above 25A at 125VAC, or very close to the 3.5KVA rating.  Within a week the transformer shut down, and I had to jumper the shore power input around the unit.  The next summer I sent the unit back to Mastervolt (in Florida), and they found  and replaced a burned out pigtail wire from the input selector switch to the coil.  The unit worked well that summer with only intermittant high loads from the A/C.  I spent that winter at anchor in the Bahamas with no shore power.  The next winter I was in New Bern, NC and needed to use a space heater once more, and again the transformer failed.  As of May, 2016 I have not attempted any repair of the unit and it is wired out of the shore power circuit.
Since both of the failures (I'm only guessing on the second) ocurred on the input side of the transformer, the continuous high current load when running a space heater may be the cause.  With the first failure I suspected I made a poor connection to the 32A breaker when I arrived in Bermuda on the way back from Europe and was back in the 115VAC60Hz world.  When I re-installed the transformer in 2008 I was sure there was a good connection.

It appears to me that the running of a space heater, in addition to the other AC appliances, through the transformer is the source of the problems.  If and when I repair the unit from the last failure I will add a circuit (possibly re-using the 230VAC circuit installed in Europe, for continuous loads, such as the heater, that bypasses this transformer. 

One other contributing factor to these failures might be the voltage supplied at the dock receptacles.  In the first case I was berthed at a marina owned by friends that had a history of wiring problems in the past.  The dock had be re-wired a year or so earlier, and I had not observed any voltage issues while berthed there.  In New Bern I was on a dock with 3 or 4 other live-abords several being large powerboats with significant power demands.  In either case if the voltage dropped much below 100VAC, the maximum load from onboard devices of around 2900W could drive the current to nearly 30A, and stress the transformer to its limit without tripping a breaker.  I did not observe such a voltage drop, but I don't have any monitoring capability beyond the voltmeter on the electrical panel.  Also the two biggest loads are the water heater and space heater, which are primarily resistance loads.  If the voltage drops on these loads so will the current.  Basically I have no answer for the failures, except that the Mastervolt rating on the transformer is not very conservative.

One interesting (to me) annecdote on these transformers is the different experience Jack Tyler had with his installation on Whoosh.  Jack went with a US manufacturer (Olsen) recommended by another cruiser.  I learned from his description that the transformer weighed nearly 100 lbs.  I didn't want to have to deal with maneuvering that much weight into one of my cockpit lockers.  At the Miami Boat Show I inquired at the Mastervolt booth on their transformer products.  As luck would have it I was talking to a real technician from the factory in Europe.  The unit he recommended, and I purchased, weighed less than 40 lbs.  When I commented on the weight Jack had to deal with on his US-made transformer, he said words to the effect, "Oh yeah, that's due to the obsolete standards enforced by Underwriters Laboratories that require manufacturers to pot (fill the enclosure with non-conducting material) the transformers."  Well Jack's potted transformer was still working when he sold Whoosh in Australia nearly 10 years later and mine worked for less than 4 years and is still (2016) not working.  Maybe the UL standards are not so obsolete after all.
Replacing the AC Power Source Switch
In addition to the shore power connection, Sarah also has a Northern Lights 4.5Kw generator located in the aft cockpit lazarette.  Since there can be only one source for AC power onboard Sarah was fitted with power source switch.  Unfortunately this switch was located in the center of the main electrical panel.  I don't know how many times I've knocked my forehead against the large knob on this switch when working at the navigation station desk. 
Worse the back of the switch, where the AC wiring is attached is uncovered and right in the middle of all of the 12VDC wiring.  The picture on the right shows the back of the switch (blue device) after it was disconnected and being removed this year, 2008.
I had wanted to move this switch off of the electrical panel for years, however as long as it was working I had enough other projects so the switch stayed in its place.
Finally in November, 2007 the switch failed.  I had just returned to the marina from a weekend at anchor.  When I connected Sarah to shore power and turned the switch from generator to shore there was no AC power to the panel.  I suspected a problem with the power on the dock.  I verified that other dock outlets had power.  I connected Sarah to one of the other outlets, but still no power on Sarah.  I then checked the breaker on the isolation transformer and it was fine.  I was able to measure 125 VAC at the output of the transformer.  So the problem was between transformer and the AC Voltmeter on the panel.  The only device of any significance was the power switch.  I had been running the generator while at anchor that weekend so I knew that side of the switch was working.  I disconnected the generator from the switch and connected the shore power input to those terminals.  When I turned the switch to "GEN" power came up on the panel.
So there obviously was a problem in the switch.  Something had failed internal to the switch on either the hot or neutral shore power terminals.  In the picture above of the removed switch you can see a great deal of corrosion on the left-most terminal.  That is the hot terminal.
I left the shore power connected to the GEN terminals on the switch and did without the generator over the winter and most of the following summer. Finally I needed to get the generator back in operation and I still wanted to move the switch from the electrical panel.  I purchased a Blue Sea 9009 AC Rotary Switch from West Marine.  This switch is made by the same company, Kraus & Naimer, who made the old switch.  Blue Sea is just a reseller of the switch.  The new switch has only 2 terminals and is much more compact.
To install the new switch I selected the location of the original battery switch on Sarah, on the aft bulkhead below the navigation desk.  The escutcheon plate that came with the switch was too small to cover the battery switch hole so I cut a larger escutcheon plate from a sheet of Lexan, painted it and then mounted the new switch on the Lexan cover plate.
The most difficult task in this rewiring was getting the old shore power and generator cables out from behind the electrical panel.  This involved cutting a lot of cable ties and a lot of awkward pulling on the wires.  Finally the wires came loose so I could connect them to the switch and then I ran a new wire set from the output terminals on the switch back to the 50A AC breaker on the panel
While I was messing with the AC wiring on the electrical panel I took the opportunity to replace the original AC Ammeter on the panel.  The meter stopped working several years ago.  I think the meter itself (back of meter at the bottom of the picture on the right) is fine, but the transformer coil (yellow device in the center of the picture) has gone bad.  There is a clear burn mark on one side of the coil.
I purchased a Blue Sea AC Ammeter from West Marine, which included a new transformer coil.
The new meter is the one on the far left at the top of the panel.  It doesn't match the old Marinetics meters, but I once again know how many amps the hot water heater, frig and other devices are pulling from the dock or the generator.