821759A2 is a very old part number, Yellow ones had problems, you want the black one with 8 feet on the bottom --- it's covered in the manual. It will come with seal and O-ring installed.
Just paint the bottom of the bottom gasket and the gear case where you removed the paint. Top gasket already has sealer applied.
You need to clean the gasket surfaces of the exhaust manifold and elbow to inspect them, scraper or razor blade followed with long file to check flatness. Use perfect seal on both sides of new gasket. What I can see of the water passages looks very good.
Melted water shutter? Check the 2 rubber exhaust tubes, they need to be fairly flexible. Make sure the rubber plug just aft of the water pump is still flexible and tight fitting. Make sure the water dam just above it in the upper is still there and tight fitting. I didn't work on many 3.0L so I don't know if this applies to you, but after a overheat I always liked to pull the top cap on the upper and check the rubber plug to make sure it's still tight. It only costs one O-ring, found more then a few bad, so worth it. Replace the seals at both ends of the water tube. Paint a light coat of perfect seal on all bolts that go into aluminum.
Thermostat has nothing to do with exhaust or drive overheat, it just controls engine temp.
I like to put the impeller in the housing first and then slide it down the shaft, I find I'm less likely to tear the upper gasket, but that's just me. If you do, keep a close eye on the impeller key. Either way a little Glycerin or dish soap in the housing helps. Don't use grease unless your going to run it in soon.
Don't worry about that little bit of paint flaking off, almost every drive I see is worse.
Remember to pull up on the drive shaft when setting the face seal/slinger, most common mistake I see.
