Mariner 8HP - No water coming out of Tell Tale - except on muffs

I have just purchased a s/h rib with a 2006 8hp Mariner 2 stroke(International version) not running but told it needed a carby overhaul with no history i decided to replace impella, gear oil & overhaul carby & fuel filter. Cranked it up yesterday and runs great on muffs with a good flow out of tell tale but placed in a 200L drum of water (8" above skeg line so pump should self prime), and no water coming out of tell tale and engine starting to overheat after 10mins, pulled it out of the drum and back on muffs and fine again with scalding hot water coming out of tell tale for a minute before the fresh water cycled through. I removed the leg again to check the imella was was in correctly and tested it was pumping water with a electric drill (being carefull not to damage the splines), pumped as expected, made sure water tube lined up etc upon reinstall but still the same scenario. also removed intake vents to check for blockages.Does running on muffs push/suck water differently to the water pump sucking water through the engine? I really don't want to but thinking head has to come off and check thermostat, galleries etc. hoping some of the far more expeirenced guys than me might have a suggestion where i should start to investigate?
PS. This is the same motor as the Tohatsu 6/8/9.8hp for anyone that may be experienced in those.

Water must be above 8" impeller ( 20 cm ) as the impeller is not self priming.

racerone said:

Water must be above 8" impeller ( 20 cm ) as the impeller is not self priming.

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Thanks racerone, I did have it atleast 20cm above impeller, i even tried much higher on another start and ran for a couple of minutes just to complete test.
I tested waterpump with new impeller before install by placing leg in a smaller bucket of water and connected a cordless drill and ran it and could see the water pumping out and faster the drill speed, the more water flow. So being that water is coming out the tell tale perfectly i was wondering if the water flows differently through the water galleries, head, thermostat and finally through the tell tale?

when its on the muffs the water is being pushed through with mains pressure as when its in a tank it has to suck the water. H ave you checked thermostat is working correctly and not stuck closed /open

The thermostat is in behind the head on these models, 5 of the 11 studs snapped so having to drill out the broken studs which is a tedious process.
You were correct through, the thermostat was completely siezed closed so have given everything a thorough clean up, decided to check the exhaust side while i was at it and now waiting for the parts to arrive.