I'll be using some cedar boards in my next build. They're already profiled and ready for layup, just waiting for a good 4 hour time span to get them into and out of the press. The boards I'm using were salvaged off my deck from 2 summers ago, so hopefully they still have some water resistance left. As with any wood sidewalls though it's better to seal them with something.
I wouldn't use cedar as a sidewall. It's much to soft in my opinion. It also won't give very much support to your edges, it would be much easier for your edge to get bent from rocks. I do think it would be interesting to try it as part of a core layup.
