"We will not use it, it needs to be repaired and we do not want a hot tub." Sounds as if you've answered your own question. Remove the thing. Is this a wooden tub or a regular hot tub with wood for pretty? How deep is it? Does it drain well? Does the water system work, could you reconfigure it for irrigation purposes? You could use it for a planter as long as it has adequate drainage. I wouldn't put a tree in it, not enough room and dangerous near the house/deck. Is the wood in contact with the soil? If so have you checked it for termites? Pack rats? Definitely don't want those guys near the house. Make sure field mice aren't in there too, they can carry Hantavirus.

"As to normal varnish..." What kind is "normal varnish"? Varnishes come in a number of flavors based on solvent. Within the oikl based varnishes the two major classes are long oikl and short oil. Long oil varnish (spar varnish is of this type) stay relatively soft and flex with the surface they are on. Short oil varnishes dry harder, but the penalty is they then crack with wood movement, moisture penetrates, and teh finish quickly fails. Any old ship originally had the finished wood coated with spar varnish. That is how it gots it name. You do not want a hard finish varnish in this environment. The soft (almost gummy) finish from long oil varnish has the best chance of staying attached. using 8 coats would also indiacte there is way too much solvent in whatever you used. Eight coats of sapr varnish would probably pile up at least 1/16 of aninch thick, and tehn fail from being too thick. Thicker is not always better.

Metal will last better with sun and moisture, There are many ways to make it look less commercial. You paint choices can help that, use a color instead of the standard commercial black.

you need to work with a pro who has a little creativity because your objections really shouldn't be a big deal. To keep the p/t lumber from being visible, use a stainless steel grommet in the ipe post trim with a hole bigger than the one holding the cable in the p/t post. for the cap rail, do a metal cap rail to meet code, then router a channel in the ipe and mount it to that. Done. It'll take a little bit of design time to ensure that all your proportions are right and everything ties together appropriately and structurally, but there are definitely ways to get the look you want while satisfying the permit store. Obviously not dimensionally accurate or really thought through in terms of attachments, but here's the gist.