[ndutton]

I don't think the exhaust water backflood theory is conclusive yet so I wouldn't be so fast to reconfigure anything. There still hasn't been a cooling system pressure test or a manifold pressure test, both of which have been recommended as diagnostics to help us help you. They both may be fine but maybe not. The tests will tell us for sure.

If you had the raw water intake thru-hull closed as you have said more than once, exhaust backflooding is extremely unlikely if not impossible.

Also, it is entirely possible the water came from the sink water dousing via the carburetor intake horn and aspirated into engine during running or even cranking. The point being, there are still possibilities on the table other than the exhaust.

Edit: About your diverting Y valve idea, it will bring a significant risk of an unintended consequence. The waterlift "muffler" you have is a Vetus LP40 and it is the least tolerant of heat of all the available waterlifts. This forum has experienced them melting or popping the seam with even 60 seconds of operation with no cooling water which is exactly what your diverter valve will do.