Do two stroke engines for small aircraft suffer from degradation between overhauls?
Don't overthink this stuff.

If the rings are good and there are no other abnormalities, there's no reason a 2 stroke shouldn't put out rated power over its service life.  And you would confirm this with a compression test periodically and a quick run at full throttle, while tied down, to check the static RPM.  With a fixed pitch prop, if the power output is down, the static RPM at full throttle will be down, assuming temperature and altitude are more or less the same each time.

Engines like the Rotax 582 were typically overhauled frequently by 4 stroke standards, something like 300 hours, due to potential fatigue on the crankshaft, not from performance degradation.  Possibly the newer versions are being run longer than that.  I've heard that some guys are running them to 500 or more.

So if you maintain the engine, don't allow it to overheat, do a compression test periodically, say every 25 or 50 hours along with a static RPM check at full throttle, you can assume the engine is making rated power and overhaul it only if it fails those tests or has reached the recommended rebuild interval.

And in your flying, don't put too much trust in those engines. It's not the power degradation from wear that'll get you, it'll be the thrown rod or seized piston at the worst possible time.  They are much more highly stressed than 4 stroke aircraft engines, which live a much easier direct-drive life and have really beefy components.  I would NEVER fly a 2 stroke beyond gliding distance of a landing spot.  The saving grace of ultralights is the fact that you can put them into very small spaces when the unreliable 2 stroke lets you down.