replaced water pump problem..I think

[fishin0001]

hello to all, little background i work on vehicle motors for a living and I also use to work on the old 2 stroke dirt bikes in 70's and 80'sI have never worked on outboards(unless a cruise-n-carry 6700 is an outboard) before very much a neweb here.I picked up this tracker boat for a few grand.been fishing on it 3 times and I started to see little a small and weak stream coming from the pee-hole.found it to be impeller so I bought the whole kit water pump upper and lower halfs gaskets ect replaced all had a few extra parts and now I get a very heavy stream and I noticed alot of water coming out here(check pic) and water on the 2 bolts that tighten the lower unit to upper a few drops of water so I tore the unit back down and also noticed droplets on the drive shaft above the water pump...I didn't notice it before(getting old lol).is this normal or did i screw something up
199ish Mercury 40 hp 4 cylinder 2 stroke seriel# 9G265924 oil iinjected electric start
thanks for any help

 

[flyingscott]

That looks normal.

 

[merc850]

Here's a cut thru showing the internals; the exhaust goes down the tube to the prop and water surrounds it.

 

[fishin0001]

thanks for the info