Some general answers.

Most people skin kayaks with either nylon or polyester. Both are heat shrinkable but nylon tends loosen when wet.
Canvas is probably cheaper but eventually rots and is not as abrasion resistant.

http://www.blueheronkayaks.com/phpBB2/viewtopic.php?f=3&t=2005

Dyson Baidarka & Company
Local Business
Address
431 W Holly St
Bellingham, WA 98225-4315
Phone (360) 734-9226

the most informative board on skin on frame is here:

http://www.qajaqusa.org/cgi-bin/GreenlandTechniqueForum_config.pl

People have used every paint imaginable on skin boats but the most common is polyurethane varnish that gets tinted.

Also check out Youtube. There's some videos showing some of this incl s