I don't think you did any damage to your boat. I own a 1997 Seadoo Challenger with a 787 engine. If your jet boat over heated you would have heard a constant beeping indicating a over heating condition. I think the water spout, coming from the center toe hook/ handle on the rear lid is what your talking about. It tells you when water is going through the engine. It will squirt further if you running faster and just squirt a small stream at slow speeds. With the lid open on the same side of the gas filler is a capped water feed for the garden hose. Make sure the small cover is screwed on, so water won't come out of the filler end, when you run the boat in the water. If you have it on a trailer use the hose attachment under the hood I just described and turn on the water, water will squart out the rear by the jet pump, on the starboard side(right side). This isnso too much water pressure won't back up into the engine and is normal. Start the engine, and look to see if the water squarts out the little hole by the tow rope eye, on the lid. Water will also come out the exhaust on the port side(left side) and some out the impeller jet. Do this test to see if water is coming out of where it should. If you get a stream of water from the tow hook/ handle, that you didn't have in the lake, then the hose feed from the impeller might be blocked or not allowing the engine to receive cooling water from the impeller tunnel assy.
Open the lid, inside the engine compartment behind the engine, towards the rear of the boat, is a hose (Black Rubber) that comes from the Jet Pump, to the cylinder head. This is the main feed to cool the engine. If no water is coming in this hose when the boat is in the water than the engine will over heat. Disconnect this hose from the cylinder head and blow in it to see if it is blocked. Also check to see if water is present in the Hull of the boat. The hose could be split and causing water to go in the boat and not the engine.
This is a general check for you to do. I would recommend you join as a premium member so you can download a manual for you jet boat from the seadoo forum liabrary. There is an owners manual and a shop manual that will help you be familiar with the operations and the workings of the jet boat. There are things like winterizing, troubleshooting problems, and electrical and water route diagrams. Click on the seadoo manual link at the top of the page, for more details. It isn't free, (like $10.95 a month) you can quit at any time, but the info is priceless as you can download it and read it on line or print it off to use boat side. Also this way if you have questions we will know what the part is that you are having a problem with and we can help you solve it better. If you have any other questions or want advise on the problem when you find it, let us know and we will be more than happy to help you out. Do the water test and get back to us...
Karl
