I never kept up with all the jet applications, but familiar with some, but I'm wondering ... did the 403 cid come out that boat, what year is it ?
Most applications came out with the 460 Ford and the 455 Olds, some with big block chevy, and only a few with the small block chevy. Reason I'm asking, it's not uncommon to see someone build up a new motor for a jet boat, not being familiar with the cam, pistons and heads required to turn the pump up to speed, and having the pump re-built to spec's, would certainly pull down the rpm's if the impeller damaged to begin with.
I do know that timing is critical on the motors, and yes, too far advanced will drop rpm, and like Rich said, that causes detonation "ping" and you can usually hear that, poping back through the intake valve, and you can sure hear that, both can cause melting of the piston ring glands, score cylinders, knock out rod beaings, burn valves, any or all of which will destroy the motor.
I would suggest getting on line, search for the timing spec's for that motor, mainly the total advance spec's, spark plug gap, set them to spec's to know your motor is safe.