OK, now what???
 

First wanted to say thanks to everyone who has responded with my questions about alignment tool and alignment procedures. Now I am really frustrated!!
After several hours of trying to get this thing aligned, figured I would order the new ITS tool with the slide to make this easier as suggested in a previous thread. Get it in this morning, and WA LA, it will not go into my coupler. So I guess my coupler is toast, which is strange since there are no splines that are distorted, reached inside and felt no slivers, etc.. it looks fine but tool will not enter the coupler. So do I need to pull the motor out or just drive it in and drive it till it breaks??

So far this is what I have found out. In '98 and '99, Mercury switched vendors for the coupler and the new vendor did not ream the coupler to take out the ridges in the brass. It was not a problem as the drive shaft will still go in but the alignment tool will not. Mercury said to ream the tool down .020 and then try again. Thanks SeaDated for the info and will try again.