Seeking Advice: Wet sanding 41 year old gel coat "step" after decal removal?

[JUST JOHN]

Hello, I'd like CSC's advice before I take my next step. I purchased new SeaCraft vinyl decals from Topflitegraphics and finally committed to taking off the old original 41 year old stickers last night with the rubber wheel. As with the name on the back of the boat, I am left with a significant "step" in the gel coat from the virginal protected parts and the oxidized-rest. I've read about wet sanding this with 600/1000/1500/2000 grit, then compound, but I'm nervous as I read that some gel coat layers are as thin as .01" thick. -The step is at least that!

Shall I go for it? (and in the process perhaps commit myself to doing the entire boat ughhh) or shall I just compound and line up the new vinyl as best as I can? Your input and experience is very much appreciated! I was able to get a nice acceptable shine on the boat last year w/o wet sanding, although the surface is still very much porous. We've owned this 1977 boat since 1978 and most years I remember we compounded it annually, either by hand or machine.