A bit of an update if anyone is interested.
The Tiny tach now works reliably. It sure is handy. Due perhaps to hysterisis (play) in the throttle linkage, setting the idle is difficult. I can set it to 750 rpm in neutral as per the book but that doesn't gurantee that if I advance the throttle and return it to the idle stop I'll get the same rpm. Guaranteed I won't if the engine is in gear. Most times the engine shuts down with the throttle on the stop. That, for me, is not really a problem. It is more of a benefit.
To start the engine, with it in neutral, I visually set the throttle linkage to the start position. One pull on the cord and away it goes. I can then adjust the throttle as required to give 750 rpm -0 +50. That reference is a good one to have when shifting out of neutral to prevent the engine stalling. (Remember I removed the tiller.) All other engine operation is normal. When I choose to idle, as in when approaching a dock, since the engine is in gear, I'll use the Tiny tach as a reference to set the engine rpm to 750 -0 +50. When I am finished with the engine, rather than use the kill switch, or reach around to manually select neutral, I just snap the throttle back to its lowest position and the engine quits. Doing it this way is actually quite handy, not a lot different than the throttle on a jet engine.
I now have the boat set up so that wide open, on the step the Tiny tach reads 5300 rpm. I'm happy with that. If I'm not getting 5300, I know that there is more that I can do such as shifting my weight slightly forward. 5300 rpm corresponds with the sweet spot on the step. Too easy. A lighter pilot will no doubt yield a higher rpm, but still within the safe engine rpm range.
4500 rpm appears to be another key. If I get much lower than that, the engine takes time to accelerate. If I can maintain at least 4500 rpm I seem to be in the torque range where it accelerates well. So manoeuvering through wakes etc often becomes a matter of visually seing what needs to be done, and planning how to do it at 4500 rpm or above. If I am on the step but have had to slow down and am about to turn, as I begin to turn I'll add throttle to maintain rpm and thereby stay on the step.
I am now satisfied that the water tube cooling indicator is likely not required for reasons I mentioned in the previous post, but I think I'll keep it.
I am very pleased with what a smooth running engine this is.
Cheers!