Split-level house built in 1975

Bad smell at the front door (upper level). No noticeable moisture in either the sill or standing studs, but visible stains. How much of the sill should I remove beyond the visibly affected area to eliminate the smell?

Realize the sill has the wrong type of insulation, how should I approach this in the rest of the house?

Planning to replace the exterior paneling in the summer, but would like to get rid of the bad smell before closing up the floor inside.
 
  • Basement floor in a 1975 hillside house showing wooden beams and visible stains, possibly indicating moisture issues. Inspecting for odor source.
  • Close-up of wall section with wood panels showing discoloration and text "Plan tråd" written on one panel; yellow insulation visible beneath.
  • Close-up of wooden beams in a basement corner with visible stains and insulation, suggesting water damage or mold issues in an older house.
The green color visible at the cut is from the saw blade, not from the sill itself.
 
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