Re: Lower end 'slipping'?
Like most, your 1958 Johnson has a rubber hub in the prop. You can't see it, but it's there. Given what you describe, it's almost certain that it's slipping. Nothing else in the drive line can slip like that, and, unless your outboard is mounted way, way, too high, it isn't cavitating.
Try a spare prop or take the old one in and get it rebuilt. Props for that engine are inexpensive, and there are always dozens of them for sale on ebay. Buy two. Always have a spare.
I had your exact engine. I guarantee that your problem is a slipped hub. Get a good prop and it'll be fixed. Happens all the time with those props, especially the 50-year-old ones. Rubber deteriorates.
You can get a brand new prop for that outboard right here on iboats. You'll be surprised at how inexpensive they are. I bought my spare prop, though, on ebay. Cost me $15, plus shipping.
As long as your anti-ventilation plate on that engine is running underwater, it's almost impossible to get that 35hp to cavitate the prop. The engine is designed to run a bit deeper than most modern engines.
Don't waste any more time trying to figure it out. You have a slipped hub.