I have a new remote oil filter housing on my boat. The stock oil lines are all 1/2". I had to got to a Hydraulics shop and get a new fitting crimped onto my stock line. This new fitting has a 3/8" I.D. I am concerned about running the motor with this smaller fitting. Motor is a stock 1996 454 Magnum. Anybody have any experience with this?

The 3/8 is to small you need at lease 1/2 in dia Here is a place to buy all new lines run -10 and you will be good the 3/8 is boarder line to small and I think that is what mercruiser used on the gen 6 motors
http://aeroquip.cc/aeroquipracehose.aspx
http://aeroquip.cc/aeroquipaqpracefittingsfba.aspx

Problem is nobody makes a fitting that will mate up to the stock oil cooler which is a -8 male inverted flare. I may have to buy an aftermarket oil cooler just to get away from the stock hose ends.

there is nothing at all wrong with the 3/8 id fitting. all the std fittings on the 502 NA mercruiser stuff are that size and the math for the flow rates and demands suggest that those are more than sufficient. the inside dia of a -10 fitting is only about 15 thousandths bigger. if the rest of the oil system is stock and the lines are not abnormally long... 10 or 15 feet or something...and you don't have 10- 90 degree fittings, you have no issues what so ever.

Not sure what to do now, All my hose is 1/2" except for the 1 fitting which is 3/8". I wonder if that will cause the oil to foam at the restriction

again... if all we are talking is short lines, and a stock oil system, you will be just fine. think about... real engineers with real degrees and a vested interest in getting things correct have built a billion motors with lines that size and they all work with no issues...
unless you have done something REALLY different that changes the requirements , you are safe by 300 %

I measured all the gen 6 stuff that came off my 2000 502 mpi and there were fittings as small as .375 stock and it was fine STOCK. When I opened up bearing clearances and went to a higher volume oil pump it became a restriction, oil wasn't getting from point a to point b as much as it should have and it showed at the actual pressure reading at the block after passing thru everything. when the restrictions (small id hardware) were removed I saw more oil pressure at the block. I also feel the oil pump bypass was opening and foaming up the oil. If possible polish/ream/bore id of the restrictive fitting to a larger size IF there is extra beef. A mistake that is often made is guys having hydraulic shops make oil lines from heavy duty fittings, some of that stuff has 3500 or 10,000 psi ratings and is extra heavy duty which gives you really small id fittings. If your motor is bone stock you should be fine, if you have loosened up bearing clearances and or went to a higher ouput oil pump you may run into issues, Smitty

Thank you so much for replying guys. It is indeed a hydraulic fitting that I had crimped on the stock hose that has the small I.D. I am going to ream it out a little bit. Hopefully that should work for me