[Destroyer]

Politely speaking,... Sierra sucks. Buy the Mercury kit...it will have everything you need and will fit exactly.

Looking at your impeller, it looks fine. There's a little wear on the spline tips, but nothing that would cause me to worry. The fact that you had water running thru the muffs is probably what saved it. Don't forget the water is the lube for the impeller, so since it was wet it didn't suffer the damage that a dry impeller would.

Yes, the driveshaft has splines on the top... they mate with the bottom of the crankshaft. No, they are not supposed to have grooves..that's wear. Nothing you can do about it except replace it, no way to repair it cheaply. But based on the amount of wear I wouldn't worry too much. There's still plenty of meat on the splines. Put a little high temp grease on them before you marry them together again. My bet is it will last longer than your engine. I'm sure that other people may disagree with me, but logically speaking, there's no reason to spend LOTS of money on a new crankshaft and driveshaft while the old one is still very functional.

As for the "t"stats, yes, by all means put them back in. You engine requires a certain temperature to run properly. Having the stats out will cause it to run cooler than it's supposed to and will, over time, damage it.