Re: Raw Water (Engine Cooling) Plumbing question...
No impeller in the drive on the Volvos, the raw water vane pump is it.
The thermostat housing is the key here, the raw water not used for cooling needs a way out. The rubber exhaust components also need water in the exhaust mix all the time so they do not melt.
Right now I do not understand the exact nature of your system and plumbing, but I will try to describe the way most inboard engines I have seen work.
On most modern era marine inboard 4 cycle engines the marine specific thermostat housing is a large unit and more like a manifold with ins and outs, and is where the raw water supply is made available to the engine's cooling system. When the thermostat is closed water does not circulate thru the engine and just bypasses directly to the manifolds. As the thermostat opens up this raw water supply is drawn into and circulated thru the engine by the engine's water circulating pump. The thermostat is at the "end" of the cooling cycle and acts more like a lid. When is it closed the engine circulating pump cannot move water thru the engine.
The water from the drive intake is drawn up to the raw water vane pump, the outlet of this vane pump sends the water to the thermostat housing. The thermosat housing is the ultimate water supply director of this system. It has outlets going to each exhaust manifold. It has a large outlet that goes to the engine's circulating pump. When the thermostat opens water flows (propelled by the engine's water circulating pump) up thru the engine and past the thermostat and then into the exhaust. When the thermostat is closed the water just goes directly into the exhaust.
I do not have a picture to show, but at 00:31 into this video pause it and you will see all the components I refer to.
The vane pump is crank driven and is on the crank pulley. The bottom hose comes from the drive, an oil cooler would be between the pump and the drive if so installed. The top hose goes to the thermostat housing, you can follow the rest from there. This is a GM 350 V8 engine for reference.
http://www.youtube.com/watch?v=BoWHEpDS0Ws&feature=related
I do not know exactly why your vane pump feeds into the engine, and I do not want to try to reverse-engineer anything here, but look at all your components again in light of the example given to see if it makes more sense, or seems even more of a hack...