I would say my relationship with my Dad is very similar to yours. We get on very well and I have a deep amount of respect and love but we do not speak very often. I have found that we have had our best times while actually working together on different projects. Either him helping me build a deck or me helping him with his camp. I'm not much of a water guy or fisherman so I do have a good idea as to what it might feel like to be put in that situation. If you guys live close and he could still store the boat and you were able to take him out once a month or so I think that would be the best solution.
My relationship with my biological dad is similar to Highlander. We get along best when there is a project we can focus on and work together. It works for us. Otherwise, he just plain drives me bonkers. I tried to teach my dad to fish but he won't touch a worm and I feel stupid baiting the hook of my old man when he's not an invalid.
Now my stepdad is the one that taught me to fish. We both had boats that were lost when the barn they were stored in collapsed under heavy snow. I haven't been fishing in years and I miss it. Work and life keeps getting in the way. I'd love an excuse to get out there and just sit with a pole in the water. It's not about catching stuff, but about a chance to relax, unwind, and BS.
Your story made me think of my grandfather. He tried to give me his nice set of golf clubs when he felt he wouldn't be able to golf anymore. I said no, you'll golf again. He didn't and someone else ended up with the clubs. I go out golfing only every few years. But I still wish I had those clubs to remind me of him.
Now golf clubs are a lot easier to toss into the corner of the basement than a boat. But I like the suggestion of accepting, but keeping it at his place because you lack the storage. Then you tell him he can take it out anytime he feels like it. And make it a point to suck it up and go out with him once in awhile.