Whippet, if there is water in the oil it will take a few oil changes to get rid of it. You can run the hoses up to another spot and install the A/S valve and then back down to the exhaust. I had to do that in my boat. My engine is in the middle so I ran mine up behind a berth and up into a storage shelf to get well above the waterline. Even at that with my low freeboard the valve would often still stick so I went to a manually operated one
now I need to remember to open and close as necessary.
Just stick the hose in a bucket, as long as you are close the pump will suck it in.
As far as your injection point lower would be a bit better, however I'm not sure a chnage is needed. Mine is not to much differant and I have no rise at all from the manifold.
Dave Neptune