Why do some boats have them and otthers dont.. advantages, disadvantages.. Im clueless on this subject. Is there a horsepower limit to them?

It all depends on what mass produced outrive you choose to use wether you run a transmission or not.

Alpha's and Bravo's do not require transmissions. They are shiftable drives. TRS's and SSM's require transmissions.

What Griff says is correct, however some SSM's utilize crash boxes, particularly in old school raceboats and especially some older Apaches. Crash boxes can handle more horsepower but you cannot shift them while the engine is running. So while the engine is running, you are either in neutral OR forward, OR reverse and you have to shut the engine off to switch gears. As you might imagine, they are a hoot to dock with - not for the faint of heart. Today with trans companies like BAM and others where the trannys can take big horsepower, you don't see crash boxes too much any more.

Barry

Wow, good explanations. I always thought it was the amount of HP that determined to have a transmission or not. I can see where crash boxes could be a real pain.

A transition is... when a guy...for a good example...Take Docmanrich..who sometimes has these girlish tendencies, (actually all the time) and is wanting so bad to be a woman, but can't... cause he has a small p*nis, at least that's what Jen told me. This is a bad transition that you really wouldn't want on your boat.

Well, it's knid of dependent on HP.
Merc used to have the alpha for low hp engines. It shifted internally in the lower part of the drive, similar to OB motors.
Then for the bigger hp motors, BBC, they used a trans with the TRS, SSM, etc drives. Probably because they couldnt make a strong enough lower unit that could shift and was not the size of a 5 gallon bucket. BTW, a big lower unit slows a boat down a lot.
So someone probably thought of putting a larger shift mechanism in the upper part of the rive and the bravo was born. So merc tried to put every iteration of the BBC they could think of in front of a bravo and decided to discontinue the reliable TRS drive/tranny. Well... heavy boats, big hp, high X dimensions, etc came along and the bravos didn't hold up too well.
So for bigger HP, some aftermarket drives were produced that used a trans and non-shiftable drive. Imco and Konrad come to mind.
Now Merc is offering a new trans and non-shiftable drive on their 700hp package, as well as the Huber/SSM packages.
So yes, it does depend on HP.
My $0.02

dont forget if your running arneson and other surface style drives......

There are put basically, some outdrives that have incorporated a shifting device, cone clutch or dog clutch or electric shifting devices and there are the others that have not incorporated them either due to design limitations or the power limitations of the above mentioned shifting methods.

Bravos use a cone clutch
Alpha's use a dog clutch
Merc outboards use a dog clutch
Volvo has cone clutch system
Yamaha had a different take on their shifting
Someone made an electric shift.

Others dives such as Mercury TRS, SSM#1,2,3,4,5,6 and 7 require a transmission to do the shifting for the outdrive.

Sea Power required a transmission. Inboard shaft drives require a transmission.

Arneson's require a transmission etc. etc. etc..

Everything has a power limit. Transmissions, dog clutches, cone clutches, electric shifting devices. Push the power up and you will find a weak link.

What exactly are crash boxes?