I was stuck on that last night for ages too. The game is much harder than the last one. It's like they just continued on the difficulty curve from the end of the last game. It makes it more frustrating but much more rewarding. I got past that bit of the boss by staying in front of one of the gaps above his head and moving over to the other one when he aimed again in order to make them all ricochet above that rock barrier. I noticed that he doesn't aim directly at the ship but at an angle in order to hit it, which makes trying to hide from it so bloody annoying!
I love that one, nice Galaga tribute, essentially after he has eaten you the first time and errr emitted you from his posterior, do that bit and you will go back, gets harder now, this time when up at the top try and hide in the water, leave some rocks above you as much as possible so his bullets? when bouncing around miss you as much as possible
I am of course presuming you know you need to shoot his neck and then cling on to his tail after he has eaten you
Yep - musta taken me 20 goes so I gave up. The bouncing bullets are just evil!