Paint only as last resort.  I wet sanded mine with 800, 1000, and 1500 grit, aggressive compound, good polish and two coats of wax. Looks like new.  Paint at waterline will be constantly chipping as you hit debris.

Peter -
Did this a few years ago, and I think you've got the steps reasonably correct.
I bought a quart of Interlux Brightside Polyurethane flag blue, if I recall correctly, and there was plenty left over.
I found about 24 hours was needed between coats in that temperature range.  Can't tell you how long before launching. The tech sheet for the Interlux Brightside, with prep instructions and drying time, is here.
Try to avoid leaving the tape on for too long, as it can become a PITA to remove without doing damage to the paint. 

Enrique and Paul may regrettably be correct about the durablilty, but their boats are a decade or two newer than ours, so we really didn't have much choice.  But I think our repaint job looks pretty good a few years after the fact (and definitely much better than before).  I won't say its the smoothest paint job, but any imperfections are really not noticable in that location (or at least I do a pretty well at ignoring them).  Anyway, I've moved on to other paint jobs to obsess over (still refinishing a bit of glass work I did over the winter to repair the cosmetic damage done when a bouy, um,  rudely decided to run into us last season while we were happily sailing along on the Long Island Sound!)

One last point: On our year boat -- but maybe not yours -- there were originally two white stipes at the waterline, one between the two blue stripes and one below the bottom blue stripe.  The lower white stripe always looked filthy, and following the example of another C36 owner in the same boatyard, I just extended the bottom paint over the lower white stipe to the bottom of the lower  blue stripe, which looks much better.  The first picture shows the boat right after we bought her in 2010 with the 2 white stripes, the second is from 2018 with the lower white stripe eliminated (and the two blue stripes repainted)

Hey guys, I would love to see pics of this area you're speaking of.  I know on the boat that I am buying, the white are between the bottom paint and the lower waterline stripe is fouled and needs to be cleaned.  I have seen this written about several times so it must be a continual issue.  I would also like to see a pic of that bottom area painted over as Mathew described.  Is it a white stripe down there?  I assumed it was the absense of a stripe, but having a stripe decal there would explain the constant staining.

Mike

Peter-
Here's a suggested experiment-get several grades of sandpaper and a soft sanding block. Start with a small area on the large boot sripe- wet sand with 300-400 grit paper. Get a sense for the amount of work vs. color restoration. If minimal color is restored, try a slightly more aggressive paper- say 220 grit. Get a feel for what grit works best. I wouldn't go below 180. When the color is where you want it-move back to finer papers maybe finishing with a 1000+ grit. I would manually sand and experiment with a small area. 

Maybe someone who has actually done this can offer some comments.

I've repaired stress cracks on the toe rail. I dremel the cracks and then overfill the crevices with gel coat. I sand the overfill flush to the surounding surface- starting with 100 grit and then moving to finer and finer papers - ending with around 1200-2000 grit with wet sanding (always by hand and with a sanding block). I've discovered that you need to experiment to develop the best technique. Start with a small area and build confidence

Peter: When we bought our 89 the gelcoat including the stripes was very oxidized.  I went the compounding and polishing route. And while not perfect - it looks pretty darn good, and with 2 coats of good paste wax at the water line annually, has stayed that way for 10 years.  Might be about due for another polish - but it beats the heck out of repainting.  If the buffing and polishing doesn't get it done - you can always paint.  Just me 2 cents worth

​Your hull is young, 2000 as is mine 1998.  If you want to really fix your stripe the following is what you should do:

1.  Get yourself a good 7 inch polisher Makita 9227 is what I have and it is great.
2.  Get a wool compounding and a wool polishing pad for it.  I believe the 9237 model may even come with these and a nice carrying bag.  If you are serious about maintaining your hull like new these are musts and will do a better job than you can with elbow grease.  (Will also save you the pain).
3.  If it is as bad as you say use about 600 grit wet sanding to get rid of scratches.  1000 grit to get rid of the scratches caused by the 600 grit and 1500 grit to get rid of the scratches caused by the previous standings.  Do this by hand.
4.  Get Presta Compound and use your polisher and compounding pad.  You will begin got see the shine come through.
5.  Get Presta Polish I think they call it cutting cream to really bring out the shine.  You can get Presta on Amazon.  Their professional grade products are expensive but worth it if for no other reason than great results with less effort.  My motto.
6.  By hand put on and buff out two coats of Colonite 885 wax.  This is just to protect the shine you created with steps 1-5.  It will add a little more shine but not much.

You will be happy with the results.  I did this to my entire hull several years ago and it looks great.  Every year I just do steps 5 and 6 and it everyone comments on how shiny my boat looks.

Enrique

Mine is quite a bit older, and I just had the topsides completely buffed and wxed, and the bootstripe and waterline stripe look like new.

Peter now that you mention it I did get a bit of clogging in my first sanding. Must have been left over wax from prior year.  Thanks for adding the step I missed.