Its a Bukh 10 HP, currently 40 years old. Seems to be in good condition, starts fairly well, but I need to be sure I can depend on it more or less. So these discussions are very helpful for me as it guides me into what to look into that of course at this point I am overlooking and additional things to try and do.
I had this same engine in a 28 foot boat. These are wonderful little engines. They are extremely easy to work on, extremely reliable, and a joy to own, although the parts are more expensive in the U.S. than the more common engines in the States like Yanmars.
When you talk about an engine which is not effective in reverse and an engine which is overheating, both can be symptoms of badly fouled propeller. When marine growth (barnacles, and other mollusks) attached to the bottom of the boat and the propeller, these can create greater resistance and reduced effectiveness for the propeller and so over work the engine, causing the engine to run hot, and reducing its effectiveness in reverse.
There are couple things that I would check if its not a foul bottom or prop. First of all, I would start with the water pump. The water pump impeller is pretty easy to change and should be changed every year since. As others have suggested, the mixing elbow can get easily clogged and cause overheating. I had to replace the thermostat twice in the 14 years that I owned my Buhk and do that would be another likely candidate.
I do not know if your engine has an outdrive or a conventional propeller shaft. My Buhk had an outdrive and that outdrive used a Gori propeller. That propeller was poorly made and would fail periodically allowing the inner hub to spin independently from the blade carrier. I would notice this first when in reverse since there would be an unnaturally long delay between the time I put the engine in reverse and the time that the boat seemed to respond.
My recollection is that these engines are geared differently in forward than reverse, and as others have noted, propellers tend to develop a lot more thrust in forward than reverse so you need to expect different performance in reverse than forward. One thing you do not want to do (since these are very torquey little engines) is to rapidly increase RPM (revolutions per minute- i.e. engine speed) since this can cause the propeller to spin ineffectively and not create much thrust in reverse. It is better to increase the engine RPM slowly and steadily as you feel the propeller grabbing and slowing the boat.
Unless there is something seriously wrong with this engine, which I doubt since it probably would not start or would sound awful once it did if there was a serious problem, I would certainly repair it or even rebuild it before replacing it.