Re: Tohatsu 90 2 stroke losing power
You need compression, spark, and fuel.. It will be related to one of those things. The reason I asked about compression is that is says a lot about the health of the engine. If you have good compression, It should come down to delivery of fuel or presence of spark.
On your engine there are a few things (failsafes) that will limit the RPM to protect it. For example a high temp or lack of water pressure will put it into limp mode. I assume you have a strong pee stream??
If you have good spark which you said you had and good compression, I would focus on fuel delivery. You could have junk in the tank blocking the pickup, you could have an air leak in a hose sucking air at high RPMs, you could have poorly adjusted floats in the carbs.. There are just lots of htings that if you don't understand the workings, make it very difficult to diagnose.
the only thing I can see related to seal is if you have a bad exhaust gasket that is letting exhaust into the engine cover, essentially choking the engine. Thats easy to test. Just run without the cover.
I would take another compression test just to make sure it is good.