Re: Mercury 85HP 850 Thunderbolt lower unit compatibility
Disconnect the shift cable from the upper shift arm then reposition the shift arm in the general location for forward gear (arm towards the front of the motor). With the cable disconnected, you'll be able to freely move the arm just a bit to align with the shift shaft. What's happening is, in Fwd there's a bit of preload in the shift cable adjustment. This is necessary for correct shifting action with everything put together. However, when you're trying to reinstall the L/U this preload puts the upper shift rod slightly out-of-position from the L/U shift shaft.
An alternative to disconnecting the shift cable is to place gearbox and remote control both in Neutral then try again. Since Neutral has a positive detent both in the L/U and remote control box, you're more likely to get things lined up. Of course you'll have to have long arms or a helper to rotate the flywheel a bit CW to align the crankshaft splines and the end of the driveshaft.
To shift to Neutral, wrap a layer of tape around a pair of Vice Grips or slip-jaw pliers (Vice Grips work better). Very Very carefully grab the L/U shift shaft splines and rotate CCW. You'll feel resistance then it'll shift into Neutral (providing you're still in Fwd gear now).
Verify you're in Neutral by moving the prop, it should frewheel in both directions.
With the control box in Neutral you should be able to get 'er installed! Be sure to test-shift once you've got the L/U sucked-up to the center section. Shift to Fwd then back to Neutral then leave it in Fwd and you've got it!
Sometimes they'll just slide back together in Fwd gear like nobody's bizness; then you've got the ones that want to fight you. I've found disconnecting the shift cable to be the best solution in that case. Have never failed to reassemble a 'cranky' one after doing that!
HTH & G'luck on the reassembly..........ed