1993 alpha 1 gen 2 water oil mix in bellows

i just purcahsed this boat from my neighbor for 1200 including trailer. its been sitting since 2001. had to replace the ignition module to get it started. replaced cap and rotor. changed engine oil. removed out drive to replace water pump and service it and check bellows and gimbal bearing. out drive had about a teaspoon of water in oil that came out first? can this just be condensation from sitting for that long. pressure tested drive found the shift seal leaking the one ontop of plastic housing. also found water in u joint bellow mixed with oil. gimbal bearing rusty. ordered new quicksilver transom kit with all the bellows and gimbal bearing and neccesary parts. do u think its the upper gear case seals that need to be fixed. i sprayed simple green/ water on the drive shaft did not see any bubbles their. order the tool to remove the spanner nut tonite. should i pull out drive shaft and replace the oil seal and o ring inside the upper housing on the drive shaft yoke side? any help would be appreciated thanks.