I bought a used boat in the spring and the on-board Hummingbird 3004 worked fine until I took the boat out this past weekend.  With the depth at set to 30' all I saw was a solid line at the top of the display.  With the depth set to 60' I saw a wild display of dots between 35' - 60'.  The water that I was in was between 5' - 20' the entire time.  A buddy of mine told me that it was likely the transducer (which is no longer made).  The current transducer is mounted inside the bilge with alot of epoxy(from the previous owner).

Should I go out in search of a compatible transducer?  Or should I just go for a new unit all-together?

I cannot say I know anything about your specific graph....but with the affordable prices on decent graphs these days....I would opt for something more modern.

I hear ya.  I'm leaning that way.  I want something accurate, but I don't want to drop a few hundred to get it.  Is there anything out there reasonably priced that is the "low cost wonder", or is it pretty much a crap shoot?

Can you remove the epoxy from the transducer and add water in the bilge to see if it reads then?

Since I don't know your experience level with sounders your problem might be as simple as poor adjustment. The through hull transducer in my boat has been serving me just fine since about 1990 or 1991. I have replaced several TM mounted transducers I suspect from banging into rocks and the like.

I can try.  If my bilge is bone dry... would that cause my transducer to fail?

I'd be cautious about removing the transducer. They are usually epoxied in securely and if it not damaged you are likely to damage it during removal.

How could I tell if my transducer is bad or not?  (btw - experience level = 0)

You need the instructions for the unit although general sounder instuctions will help. You are not alone. When I bought my first sounder (paper graph) that was not a flasher  it was perfect the first time out and the second time nothing. This repeated the second time then I discovered I had changed some settings.

I am not familiar with your particular unit but generally speaking set the gain at about 85% and grey line at 50%. Turn the automatic feature off. If you are deeper than the depth setting you won't get a bottom reading. See what happens.

You could look up Humingbird on the net and call their tech support for help. Also ask the guy where you bought the boat.