Our house has a similar situation. It's 1900 sf, built in the 1890's, has some blown in insulation in the walls (we only know this because we gutted the bathroom and found it - this room will have regular batt insulation in the walls and ceilings), has the original windows but triple track storms. The old oil fired boiler is 199k BTU and our oil bills are completely heinous - we used about $650 worth of oil for the month of December. I can't imagine what our bills would have been for a house 50% larger. Just from a reality check standpoint, there is no way a house the size of ours requires the absolutely largest residential boiler available (there may be some slightly larger but in general, around 200k is as big as they get). Our old boiler does short cycle too, it's loud enough that you can hear it. Even in the dead of winter with single digits at night it cycles on and off. We are probably running somewhere in the 60-70% efficiency range also. Everyone who has quoted for us has universally said "WHOA that's a HUGE boiler for your house." After evaluating all of our options, we are going with a modulating/condensing boiler at about half the capacity (maximum) and putting zones into our house. Right now when it is 68 downstairs, it's about 80 degrees in our bedroom - so at a minimum breaking the house down into different zones for upstairs and downstairs should also help - DH works at home during the day and there is no reason to throw all of that extra heat upstairs when no one is there in order to keep downstairs comfortable. For various reasons we are actually going with more zones than that (the way our system was originally piped makes it extremely easy - labor wise it would be just as much to combine them back into one zone as leave them split - and there is a big temperature difference between the various parts of the house we are splitting off) but you might want to check into whether it is possible given your current piping to separate your 2nd floor from your first into separate zones. Between the zoning and the much more efficient boiler, we hope to slash our energy prices. It's NOT a cheap boiler (the cost of the boiler is more than the cost of your boiler + install) but with our old cast iron radiators with relatively cool return, the condensing part will work great, and with us zoning out our house, the modulating part should work great too (it operates at a much lower BTU if the demand isn't there). It also changes the temperature of the water sent out into the system based on the outside temperature, so if it's 50 degrees outside and we want to maintain say 70 inside, it's not necessarily moving 180-190 degree water through the system, so there is savings there too, especially in the shoulder months. We are switching from oil to gas (it would cost us thousands to replace our oil tanks, the real reason we are replacing the boiler - the oil tanks are not long for this world and because there is no longer outside access to the basement it would be a huge job to get the old ones out in pieces and multiple small new ones in and we decided to put that money into a more energy efficient boiler rather than use the same old boiler and just get new oil tanks) so it will be interesting to see the difference in our energy bills. Anyway it took a ton of research and a bunch of time looking at our system and figuring out what was going on to trace out the various loops we have, but I'm glad we put the time into it. We feel confident with the system we have chosen and hope our house will be far more comfortable and energy efficient for the years to come. Energy prices have nowhere to go but up, unfortunately. We are only planning to do this once so figured we'd do it right the first time. The first couple of contractors wanted to put in either a 200k btu boiler to replace the one we have or a 165kbtu boiler calculated by counting radiator fins. As I said before, some of our radiators have about 3x the capacity actually required for comfort in the room so it's kind of silly to oversize in this way because it's just easier to "replace in kind."

Look for the BEST contractor. Too many don't know what they are doing these days. There's another internet forum populated by wetheads and they have a find a contractor section leading to some great guys. Might do a search for it and see if you can find a good contractor that way.

The peerless or weil-mclain boilers are great boilers. You are basically just going to be installing a newer version of your current boiler. You can only expect 84%-87% efficency from either of the new boilers. Unfortunately that is the best efficiency that is expected from any oil boiler. Is natural gas available in your area? I would consider switching to gas (Nat. or Propane)and looking at the peerless purefire of the weil mclain ultra. You can expect 95% efficiency from either one.

You can also look at Viessmann & Buderus products. SR