What RPM was the motor at when you first started it up and what RPM was it idling at when you were adjusting the timing? Do you have the boat on a slight incline as Griff said, or is it sitting flat? How were you getting water into the boat/motor to keep it cool (i.e. the boat was sitting in the water or you had it hooked up to a garden hose). It wouldn't hurt swapping risers from the good motor as some have suggested to rule them out, but all things being equal you shouldn't be having this problem. You just have to figure out the variable.

The boat was sitting at a small angle, but nowhere near the angle the boat sits in water and was using garden hose. Ive ordered the taller riser/tailpipe. Also, would adjusting timing cause water to suck back in?

Not necessarily, but it depends how the motor is running. From what I understand some people correct small reversion problems by turning up their idle and forcing more exh. gasses out of the manifolds.

If you were forcing water into the boat with a pressurized hose, and the motor was barely sputtering at 500 rpm or so (or it was stalling and needed to be restarted a couple of times) while you were trying to set the timing, it seems to me that water could get into the oil that way through the exh. ports.

Took out silent choice and plugged Y-pipes and about to install the taller and longer Riser/Tailpipe mad for the HP500. My stock one was about 3" Tall and got new ones that are 6" tall. So maybe that will take care of it, just gotta hope so...
$$$$$$$$$