Yes, the heads on the LT-1 are aluminum. From what I have seen, they tend to be pretty great motors. I recall reading some people having issues with the thermostats (I believe there are two). But typically, they just replaced them and went on. I also recall reading that you are not supposed to use RV antifreeze in the LT-1 because of the aluminum heads. The previous owner in this situation may have known this, been resistant to using regular ethylene glycol (automotive antifreeze) in the block, not gotten it drained properly, and ended up with a cracked block.
As for overheating, lift the flaps on the rear of the boat and shine a flashlight up the tailpipes. Look for blistering inside the hoses. If they haven't been replaced, it can be a tell tale sign of an overheat.