A lot of good suggestions. My first guess is that the coolant is just overflowing into the bilge. A quart of coolant isn't a very big puddle.
The overboard discharge water being cool rules out a lot of common culprits. Bad thermostat seems most likely followed by partially blocked (or scaled) heat exchanger.
If you pull back to idle when it starts to overheat, does it cool down?
If so, check:
Do you know if the PO ever ran the engine for two hours after installation? If not, could be a a bad installation.
The overboard discharge water being cool rules out a lot of common culprits. Bad thermostat seems most likely followed by partially blocked (or scaled) heat exchanger.
If you pull back to idle when it starts to overheat, does it cool down?
If so, check:
- Overpropped: (e.g. can't reach full RPMs). Even bad prop fouling can overheat an engine. But I would think this would warm up the overboard discharge mor
- Heat exchanger needs to be cleaned (descaled) or unplugged
- Thermostat (I've had more than one "new" thermostat that didn't open fully. Engine could run fine at low RPMs as some coolant goes through)
Do you know if the PO ever ran the engine for two hours after installation? If not, could be a a bad installation.