Reasonable plan, but IME cutting out the rotten bits and then inserting new is a lot of work. It's a faff. And you still end up with a doubt about other bits.
Why not: strip off the shiplap, support the roof with the two Acrows along one side and take out the entire wall. Replace the framing with pressure treated softwood, and the sole plate, and then replace the shiplap. Don't know where you are, but in the rural area I live in there are several agricultural timber suppliers locally where I get my garden fencing, trellis, planter construction timber at what seems to me to be very reasonable prices. I'd look for similar suppliers where you are.
I suggest it'll be as quick to replace the wall framing, one wall at a time, as it will be to faff about patching. It'll cost you more, but you'll end up with a solid shed that will last for ages and you can then forget about it. And you'll definitely need a good multi-tool. You know it makes sense.