Joe, that canvas looks pretty shot......the holes are just part of the problem. The filler is worn out of the weave in the canvas. If that were mine (I wish it was, I really like the White 18 footers) I would plan to put a fresh canvas on it.
While you have the canvas off of the boat you could use a paint stripper and remove the old varnish, give it a good sanding and put some fresh coats of good quality marine spar varnish on it. When you are done the boat should be ready to go another 20 years or more with just a bit of touchup once in a while.
So, let's assume that you really want to try and patch up what you have instead of putting fresh canvas on it. First, yes, patch the holes. Use a contact adhesive and work a piece of patch under the hole. Glue it in place and then use some type of filler to level it out. Plug those other holes while you are at it.
Next you need to decide what to do with the canvas. If it's not filled it will leak and using traditional filler isn't going to be possible with worn canvas. I would suggest using Gluvit to patch up that part of the hull...you can get it from West Marine. It's something that you should really never use on a canoe but for a case like this where the canvas is shot there is no reason not to... Lather it up, smooth it out, let it cure and then go back over it with paint. You will have a really hard time matching up the paint... you might as well paint the whole hull and if you do that, any good topside marine paint will work for you. Some folks swear by Rustoleum and honestly, this might be the perfect hull for it. It's affordable, easy to use and there are lot's of color choices.
WRT the wood....it looks like someone put a new piece of planking in but did not varnish it. It's almost certainly cedar. The problem and challenge is to get new wood to match the old wood. Even the pro's have trouble doing that. Your options are to strip, sand and re-varnish the old hull or to just deal with that one area with some stain and varnish. Since it's a nice old White, I'd go the whole way and do stripping and the canvas. The boat would end up like new when you are done...
Mike
