I'm thinking you didn't get the shift link installed correctly, or you are not manually rotating the prop a little when shifting to get the gears to mesh. I also don't think the '70 has a tell tale -- if so, some water out of the exhaust port is what to expect. But if you aren't getting water up there, pull the l.u. again and try flushing up the water tube (engine off). Rig something to fit over the tube. If you have pieces from an old impeller lodged up there somewhere, or some kind of other debris, you may need to take off the head and exhaust covers to clear passages. Try flushing first.