How did it run for you last season.---That motor would come apart here for inspection.---There is damage to piston rings,----Unless it was a recent patch-up job.------Or you can run it and hope for the best.-----
???----If coil generates 3/8" spark , you should have spark at the plug boots.----From 1008 miles away I believe there is an issue with cap or rotor.-----Or boots where wires screw into the cap.
Load test your battery.----Inspect battery cables.-----Take starter apart for inspection / ohm test on armature.----What name / part # is on the replacement starter ?-----Many Mercury starters look the same, but they are not all the same.
There are people at ----aomci----Who have lots of these bypass covers.-----Post a wanted ad there.----There are other places that have these covers as well.---Depends on your location and whether shops work on these motors.---Some might have 1 or 2 under a work bench.----
What are the colors of the wires going to that plug?----Might have to do with ---trim / tilt-----tachometer----Oil injection system ( Not found on yours )
If the shift rod can not go down all the way the propshaft will not come out.-----The damage makes it obvious to me that brute force is needed.-----Sorry to be blunt.----And I am not struggling to work on these simple ( to me ) gearcases.