5' down they are talking about is essentially from the top of the wall. It's a judgement call whether to excavate another 2.5-3 ft. deeper to be sure the entire wall is state of the art. I certainly wouldn't compact the new fill. If the weepers--assuming there are any--are working, you want the water to go down to them and drain away. I believe clay weepers were still in use in '69, in which case you can be all but sure they're not functional. And, to confuse matters more, if you have free-flowing material at that level, weepers may not be necessary at all! (Only so much one can suggest at this distance.) The house isn't endangered by the excavating--unless it's being done by a careless machine operator. By hand is always best! I've used Permaquik crystalline waterproofing in both exterior and interior applications. Sometimes as the primary waterproofing, other times as a secondary in addition to the bubble membrane. ******* Did your structural engineer determine what caused the crack along that section of foundation? Water leaks leading to frost-push damage? ******** How bubble membrane works in conjunction with weeping tiles to keep the foundation wall dry This post was edited by worthy on Thu, Mar 21, 13 at 20:06

How did this get water damaged? If the wall is starting to bow out, you've got a larger problem that won't be fixed with a sill replacement. There is probably structural damage that needs to be addressed after you figure out where the water is coming from and develop a plan to prevent this. This is not necessarily a minor problem or an inexpensive fix as it's likely a load-bearing wall. You need to consult with someone to figure out whether this is a problem with the siding, the window, the gutters, the roof, etc. Otherwise you're putting a bandaid on something serious that is likely going to get worse.

https://www.amazon.com/Abatron-WR4QKRA-Wood-Restoration-Kit/dp/B0084PQJ12/ref=sr_1_3?gclid=EAIaIQobChMI6oHAwIqf5AIVigOGCh0z1ghTEAAYASAAEgLzo_D_BwE&hvadid=241929249324&hvdev=t&hvlocphy=9011283&hvnetw=g&hvpos=1t1&hvqmt=e&hvrand=16292999201620741332&hvtargid=kwd-20619661172&hydadcr=24657_10400629&keywords=abatron+wood+epoxy&qid=1566772537&s=gateway&sr=8-3 Abatron wood epoxy is the gold standard here. Even though it’s pricey it’s probably cheaper / easier than replacement.

Oops! That would help, eh?! Thanks! Greetings! We have been restoring an 1865 Victorian and would be grateful for advice on how to best repair this area of damage (water, termite?) on the oak sill...Thanks in advance for your ideas! Regards, Monica