Lumber and Siding - replacing wood under siding

I have a 1950's home with wood rot under the siding. the rotted boards are 2 by 12's laid diagonally across the framing. I assume that the best way of dealing with this is to remove the siding (asbestos-I know, a whole issue in and of itself), remove the rotten wood and replace it with plywood covered in product similar to 'plydry.' The gutters are also hanging loose due to this wood rot and therefore the problem worsens every time it rains! Is this something that can be 'diy'? I'm not afraid to try this myself, but have never done anything like this and would like to know the best approach/products. I want to do as much of this as I can myself since some things, like rotten wood around the windows, and of course new siding, may have to be done by a contractor. any advise will be greatly appreciated!

Welcome to the forums! Are you sure they are not 1 x 12's?
Of course you will have to remove the gutters, determine the cause of the problem (most likely no drip edge) repair that and replace the fascia board(s) and reattach the gutters, or replace with new, seamless guttering via a pro.
To answer your question, definitely a diy project, if you have the energy, tools and occasional help to do the job. We're here as your support team, so let us know if we can help.