This happens occasionally if you delete the faces off a solid. It's got nothing to do with your .material code :3
When you're adding a texture/material to an object in Blender, only the outside part of the model will become textured, the inside -which is the transparent part- does not become textured... This isn't easy to explain, so I'm sorry that I can't really explain in more detail why this happens xD
I know a quick way of fixing it but only using the later versions of Blender, such as 2.59. I can't remember if I ever found the same or similar solution in 2.49. What I can suggest is building an extra "layer" for the inside of the boat.
Select all the edges of the boat and press E to extrude them, then click Only Edges and using S (adjusting the scale) just choose how wide you want the ledge of the boat to be.
![](http://i59BannedImageSite/110fz45.png)
Once you've got the scale extrude the edges again, this time move the edges downwards. There's a miniature scale of the axis arrows (the red, green and blue arrows) in the lower left hand corner, it will tell you which X, Y, Z coordinate is for which arrow. The blue arrow is Z so use the grab button (G) and Z on the keyboard -in that order- to move the edges down.
![](http://i62BannedImageSite/nzvgh.png)
Once you've done that press F and it will fill in the empty floor of your boat.
Hope this helps
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