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bigut,
I just looked at your personal page. I don't think raising it one hole is enough. I would consider 3 holes to start. And if the temp is really going up the engine, being too low shouldn't cause that. At first I thought you might have a spun hub, but that won't cause the temp to rise either. You might need a new inpellor or may have a water flow restriction somewhere. Also, what prop is on there? It looks like it has a lot of pitch.
Mike
I agree, I think the two issues are unrelated. As engine load increases, so does internal temp. When was the last time your water pump was changed out and thermostats checked?
bigut. It looks to me that you have your engine mounted all the way down. If you PM your email address to me, I can send you a picture of what mine looks like later. I think you need to raise your motor at least one hole. This however, will not help you with your cooling problem and will only help in your performance.
Cooling is a whole other issue......take a look at your impeller. I'm replacing mine today after work. It's been about two years since I've put one in so it's time. I try to do it about every two years whether it needs it or not.
Cliff
1966 13' Sport with a 1993 40hp Yamaha 2 Smoker