I'd be inclined to stay with the diamond-head bolts.
In restoration of architecturally and historically interesting old buildings, it is a common problem of what point in the past history of the building do you restore to. The same issue arises with restoring canoes, other boats, old cars, and antique just-about-anything.
Many grand old houses are, in fact, a compilation of modifications and additions to an original building that may have been little more than a one-room log cabin. Almost any house or other building restoration that is being used gets updated wiring and plumbing -- unless there is a very strong reason for restoring to a point in time when there was no electricity or indoor plumbing. And in any city with older buildings, restorations run the gamut from gut renovation to precise renovation/restoration/reproduction of original detail.
We live in a house built in 1884, of no particular historical significance. The exterior is not original, but is close to original. The entry doors had been replaced in, probably, the 1930's or -40's, and the replacement doors were rotting away -- so we installed new doors that are virtual replicas of those earlier replacement doors. We just installed a new, modern bathroom with a walk-in shower instead of the coral-colored bath tub that had been installed in (probably) the 1950's, that probably replaced an old footed cast iron tub; 30 years ago, we enlarged the other bathroom and replaced the original cast iron footed tub with a contemporary tub.
On the other hand, we hired an expert plasterer to restore parts of the intricate plaster ceiling molding that had fallen out of the ceiling because of a water leak, because the rest of the original detail in that bed room was sound and attractive. In another bed room, however, most of the detailing was in very bad condition, so all the old plaster was ripped out and the walls and ceiling were sheetrocked.
So some of our house is original or restored original, some has been updated at various times in the past, and some is strikingly contemporary. We are sensitive to the character of our neighborhood, and our exterior maintenance and repairs have been in keeping with the neighborhood. But for the interior, though we like the old style where it can be kept without excessive expense or trouble, we have no qualms about updating where expense and function call for updating.
The Antique Road Show television program makes a fetish of keeping original finishes and details on furniture -- and for "important" furniture -- museum quality or of significant history -- there is some merit to the fetish. But if you have a nice, functional, comfortable but but banged up chair built in Grand Rapids in the early 20th century, you might be happier if you refinished it, and you certainly would not be significantly affecting value.
So you have a canoe with a history -- its condition at the time it was built and originally sold, its condition at some time in the past when maintenance or repairs called for some work that included replacing some bolts, and now, what it will look as you restore it and, over time, as you dent it, repair it, paint it, fix the (seat, thwart, canvas, gunwale, ??) that breaks.
Similarly, unless you have a particular desire to have a canoe that is historically correct to the date of its original construction -- and there is nothing wrong with that -- go for it. But the diamond bolts are there, they are part of the history of your canoe, they look fine (in my opinion), they appear to function well, and it would be a fair amount of work to restore the inwales so the diamond indentations would not be evident (in my opinion, a PIA in fact), which is why, if it were my canoe, I would polish up the bolt heads and reinstall them. The money value of the canoe will not be affected one whit -- so do what you prefer and add to the history of the canoe.
