Scott,
The Mercury 1940 K3 should use an oscillator (Hockey Puck) style impellor not a rotax style.
Does your intake have the 16 square holes like Sea King K1?
I would dissemble intake & prop shaft from lower unit and try a little heat on outside of aluminum
Housing using propane torch and try to press out using drive shaft Gently! i.e. light taps.
Reproduction impellor are available from Ferguson- poole
http://fergusonpoolemarine.com/
The Oscillator style pumps have a hole in cover
And the rotax vane style pumps have a slot in
Cover. (See Picture)!