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Wanted to throw out an update on my project here, the new motor from MIchigan Motorz arrived today, I originally said me and a buddy were going to do it, but in the end the Marine shop is only charging me $800 for the job, plus I wanted them to look at the carb and a couple other small things so I decided it was worth the $800 and not have the hassle.
Anyway they pulled the motor today (you were right didn't look like a tough job) and the only thing obvious at this point is there is a rust line on the block, but cant see any crack. The dealer mechanic said it looked like it possibly wasn't winterized correctly and that could have caused it. I have included pictures of it, they are going to pull the head to investigate further
Next question is Michigan Motorz told me to put Rotella T diesel motor oil in for the break in period, dealer said he just uses mercruiser oil and has never had a problem but it's up to me, opinions?