water can run uphill, via capillary action. That's how trees get water from their roots... and it can go a long, long way uphill.
the shaft log is leaking? Water cannot run uphill. I really would suspect the muffler. You say it only leaks at crusing rpm and then a fine mist? It also could be water flying off the packing gland when under power.
I would check the muffler again under power.
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You know what the first rule of sailing is? ...Love. You can learn all the math in the 'verse, but you take
a boat to the sea you don't love, she'll shake you off just as sure as the turning of the worlds. Love keeps
her going when she oughta fall down, tells you she's hurting 'fore she keens. Makes her a home.
—Cpt. Mal Reynolds, Serenity (edited)
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Still—DON'T READ THAT POST AGAIN.