Yes, figured it was a 1970's model 45 (4.5 horse).
There waterpump is considerably different than (portable) Merc's built after 1985.
This waterpump has no seal between the cover and the plate so you do need to really snug it down without "reefing" but first make sure that the mating surfaces are good and clean so that the "plate" gets sandwiched snugly between the cover and the base.
It does have a "cover seal" (sometimes referred to as an oil seal in parts manuals) where the water tube enters the cover and a seal where the driveshaft enters the cover - either could be shot.
But again, if it was working fine before the impeller was swapped, a slipped key is pretty high on the list of things to check.
Agree that if an old impeller was re-installed backwards can cause an issue (because the vanes, at this point, will not correct themselves), but with a new impeller, even if you twist the driveshaft the wrong way to get the cover on, it will right itself on first use without issue...
Actually, there isn't enough clearance for the "arms" to reverse. It usually ends with burned lobes, and/or a cracked/melted plastic pump housing.