The rudder with my Sept Girl 2789 is 36 inches draught x 9 inches at the top tapering to 7 inches at the bottom - I am not sure it is a Merlin rudder at all. It is an epoxy sheathed laminated foil somewhat younger than the boat and in pretty good order except for the bottom couple of inches which is chipped and badly worn away at the toe. The original for the design is, I believe, a lot shallower but the area is concentrated in the bottom half. 
Refurbishment would be simplified if I cut off the bottom 2 inches which is about 4% of the area and faired it. Would this have a significant effect on handling or would there be plenty enough area left?

You'd be very sensative to tell any difference but do ensure you seal the ends of the glass strands or you might get osmosis that would perhaps/maybe encourage delamination from its core.

I'd be more inclined to rebuild it with epoxy/glass bubbles.

That will also seal the sheathing and be much easier to fair in.

Also makes a project out of a simple refurb job.

Thanks for the advice. Time is of the essence so it will be a cut rather than a crown (my wife's are always falling out anyway). I intend to apply 2 coats of epoxy to seal it all, having got down to wood in removing previous botched repairs to leading and trailing edge mini dings.

First coat, including a small re-moulded area on training edge, applied and cured OK. For a self releasing and fairly rigid external shaper on the trailing edge I used a small piece of creased plastic milk bottle applied with its inside to the epoxy and held in position with sellotape. I discovered the self releasing property when I idly flexed a cut off bottle bottom that I had used as a mixing tub and the cured epoxy flaked off, allowing me to re-use it.