The lumpy stuff looks like wheel bearing grease to me.
While it may be fine for the gears it doesn’t get warm
enough in an outboard gear case to flow into the bearings
or bushings because its just to thick. Mercury actually
put the warning on the front of their motors that used
grease in the gear case.
A "Boathouse Repair" is one thats done without having tools or the skills to do it properly.