Re: Oil leak Tohatsu 2 strokes 5hp 2007
If indeed you have a 2-stroke (not available in that size in North America for years), then, yes, it is not an unusual amount of unburned residue -- and it would smell bad/burnt. It is a little odd to see it come from near the water drain holes of the exhaust housing, though. Typically that would be seen in the prop area. But if the motor is tilted a bit so the prop is a little high, that might do it.
On the other hand, if you have a 4-stroke, I do occasionally see that sort of accumulation caused by either overfilled crankcase, bad pan gasket, or a loose crankcase drain plug.