Assume you are talking about the coupler that connects the lubes path to the reservoir?? No o-ring. Just the seal on the bellhousing side. Careful not to damage that seal when putting the drive on.

Gonna pull the cooler right now, ya I used a new seal and the only thing that I can think that MAY have happened was I double stabbed the drive, put it on and had to pull off and put right back on, spring may have grabbed that washer and pulled it off, HUGE maybe, otherwise she shouldn't have leaked.....guess motor is coming back out

Ok, so pulled the cooler, seems that it's been patched before, but it doesn't appear to be leaking.....I rigged up a closed system and put fifteen pounds to it and submerged with no bubbles....ill have radiator shop test tomorrow, but if that's not it, is there any way a bad main oring could have allowed water in, down the bellow and through a bad shaft seal?????

what did i miss,
spring on the yoke? is it a merc-trans?

my other boat had tube style coolers with oil lines that went to and from, but they were borg warners

Merc trans, spring still there, cooler looks visually fine

never had to work on merc trans so didn't know the cooler is built inside the tranny
if you took a cooler of and had to remove water lines and oil lines, what did this cooler look like and where on the engine is it located

maybe you pulled a powersteering cooler that pressure tested o.k. but the culprit is built in like pickle said

sorry, went off half cocked thinking it was a borg warner

This unit was shaped like a "u" with a single copper line (probably 1/2") no oil in lines, just water in/water out lines. 4 bolts with a square gasket looking from drive to bow it would be on the right side of trannny

Sounds like your cooler is fine then. No need to take it to be tested. Did you put the boat in the water to run it when you say you were breaking it in?? Or did you run it on a trailer?? If you did it in the water it is possible it ran back in through the bellows with that big damaged o-ring and into the rear of the trans. Did you check the trans fluid level before you broke in the engine??

Yes, trans level was checked prior to putting boat in water, was high but not milky, I've ordered a new gasket kit and will install, refill the tranny and retest on the trailer to see what it does

Quick question, the oil connector on the right side of the drive....it looks like there is supposed to be an oring inside there. This one doesn't have it and the gasket kit doesn't have it, anybody know for sure