Would you worry about it NOW, or when you winterize it for the season?

No idea where the heck it is going, no oil slick on the water, my guess is prop drive shaft seal when under way. After every couple hours of use, I pour a couple ounces in to bring it up to the min level.

Are you just filling it through the res bottle inside the engine compartment?? if so i would pull the lower fill plug just to verify you dont have any water in the drive!!! If it turns out ok then i would worry about it over the winter...but eye it like a hawk!

Yes, I pulled the upper plug, and let some bleed out. Not milky.

Just filling it through the bottle up top.

About to take it on vacation, just don't want whatever is leaking to get worse. At the current rate, it would take maybe 50 hours to use up my spare quart of drive oil.

You need to check it at the lower ,not the upper.
If oil gets out most of the time water gets in.

I would worry about now befor it gets costy.

Yeah what he said
oil floats....so you wont notice any water in the drive unless it gets the oil milky as you mentioned...check it at the lower fill plug and do it first thing in the morning before you go out on the water...that will give it time to sepperate out and water will be the first thing to come out that way

OK.

But now you got me SCARED!

See it this way ,everything in your drive is turning at high speed. If oil gets out ,water will eventualy get in because all the turning parts are producing a vacum .I would check it befor i run it more .
could be something real simple to fix for a couple of bucks !

As you should be. One-way leaks on drives are very rare. Low reservoirs are a major red flag. Find the leak and fix it, before you're buying gears, shafts and cases.

Hey Chris,
we finaly agree on something . LOL

There were a few drops of water in the pan, but there was some in the nooks and crannies of the drive (ran it last night).
I am checking into someone pressure/ vacuum testing it.