Gray Marine model 109

I just recently aquired a 1957 21' Grew runabout with a Gray Marine Model 109 number G23196. I am very new to inboards and would like any information amout this engine. It was used only in fresh water is it good for saltwater? Can or should I change the boat from 6 to 12 volt? Advantages/disadvantages? It looks in very good condition whats my best course of action as I know very little about engines. I am a wood worker mainly. The engine must be removed first to get at some soft spots under it. HELP!!

Just trid to turn the engine over by hand and by a bar on the flywheel crank and it won't budge. I put some penetrating oil in the spark plug holes and undid the generator belt. I then put a scope in the holes and all the penetrating oil has leaked down so I figure (probably wrongly) that the pistons aren't stuck. Could it be the rotor?

Try to move it both ways. Pry between the starter and flywheel you get more leverage there. It's usually rust in the cylinder bore.

I've tried prying on the flywheel, and I made a jig with two pins that fit into the two holes on the pulley with a nut welded on and tried mt impact gun but no luck. Any other suggestions.

I'd pull the head for a look.

Considering it sounds like your engine hasn't turned over in a long time , as a precaution I would suggest pulling the tachometer drive off the head and pulling the drive rod up out of the block to make sure it is free. The drive rod just has a slot cut in each end & should lift right out I drop right back in. (If the engine has been untouched for a long time it is possible for rust to build up around the rod and seize it in place, then when you turn the engine over the tangs on the end of the rod break off down inside the engine -don't ask how I know.)
That Gray '109' is based on a 225cid Continental industrial engine that was used for decades in welders, generators, compressors, fork lifts, etc. so there are lots of them around in non-marine applications (makes finding parts easy).
If you are not being able to get it to budge with a good size prybar in the ring gear teeth it does sound like you should pull the head to see what things look like inside.
Yes, that engine can be run in salt water, however, that will significantly shorten its life. If it is good condition and you plan on using it in salt water I would really recommend installing a heat exchanger (fresh water cooling system). That is what I did on mine 30+ yrs ago.
6 vs. 12 volts is pretty much an 'originality' and convenience thing. To change to 12 volts you will need to swap the starter & generator.