Yes it can, and rain is known to collect in the LU that is tilted up and freeze. Straight down is the way to go.
There's not much to winterizing an outboard, have a look at Storage Preparation.
http://1manual.com/Mercury manuals/Service Manual PDFs/FourStroke/858895r1/1b.pdf
just be sure there isnt any water in that lower, or it will freeze and split the housing. just my 2 cents
dino