I'm hoping so! I'm gonna follow the advice of
@Bondo and run a little and recheck several times to make sure I'm not getting water in the gear box. The oil I drained wasn't milky, but it was fairly dirty and certainly hadn't been changed or checked probably in years.
This motor coupler has probably been a real blessing in disguise as it has forced me to look more into things than I did when I bought it. Finding the exhaust shutter issue causing me to make sure and replace the impeller and checking the outdrive gearbox has all shown me other issues that could have caused even bigger - more permanent - damage that I am hopefully now preventing. Plus, I'm learning the things I need to know about this thing if I'm gonna be a responsible owner and maintain it correctly.
Probably going to plan to do a rebuild of the lower this winter just because it doesn't feel as 'tight' when I lock it into gear as the other outdrive I have. Guessing poor maintenance over the years has led to some wear in there. I mean, it is like 36 years old. Have you all found it more cost-effective to go to an SEI drive or rebuild the Mercruiser drives?