I never got to see if the ship sank, because mine went down in about 30 seconds, and I wouldn't normally try ramming, although it is possible to sink stuff that way as I have done it with a small fishing boat before, I just did it there to demo the collision detection for you.
It can take quite a while to nail something with the gun, as they definitely try and make a run for it, but you can sink a ship with a torpedo in one shot a lot of the time, although missing them means it often costs more than one. For example that series of screenshots which I posted was a one shot deal, but on the same mission prior to that, I had used three to hit a fishing trawler because I had the petrol boat with no deck gun, which was annoying, but not unrealistic. Unfortunately some of the fun is spoiled by the fact that you get a message coming up telling you that a ship is destroyed, so there is never any doubt as to whether something is going to sink (don't know if you can turn that message off, as my German is terrible and if there is an option for it, I wouldn't know even if I was looking at it!)
As far as how long it takes to sink after being hit by a torpedo, I was submerged at a range of 5300 when I fired the torpedo at that freighter in the screenshots, and when it registered a hit, I surfaced and raced over there at 13-14 knots, as you can see, I got there just as her decks were being swamped and that may be because it was a good hit on the stern which in reality would have blasted the packing open on the screws and been fairly disastrous for them. So I reckon it went down in well under ten minutes, which seems fairly believable under the circumstances.
Chock