Diagonal Wood Sheathing WRBs, and Siding

This is a homeowner forum question, not a news story, so there's no program update or policy change to report. A homeowner with a 150-year-old house is dealing with failing stucco siding and wants to strip it down to the original diagonal wood board sheathing underneath. They're weighing two rebuild options once the stucco is off. One uses foam insulation panels with a water-resistive barrier (WRB, the layer that keeps rain out while letting the wall dry) already stuck to them, fastened right over the old sheathing, then furring strips and fiber cement shake siding. The other option skirts a peel-and-stick WRB directly onto the sheathing, adds rigid wood-fiber insulation boards, then furring strips and the same siding. They plan to fill the wall cavities with cellulose insulation and would rather not add a layer of plywood or OSB sheathing over the old boards first. They're also asking whether a couple of other structural insulated sheathing products might make more sense instead.

There's no answer or resolution here, just a homeowner posing the question to a building-science community, so there's nothing yet to tell you about which approach won out or why. If you're facing a similar situation, a leaky or failing exterior on an old balloon-framed house with board sheathing, the same questions apply: how to add a weather barrier and insulation without trapping moisture in old lumber, especially in a climate with wind-driven rain, humid summers, and snow.