i was in the industry at the time those engines were introduced - they had problems, and had one blow up after 500 hours, which from what i heard was normal. don't know if they have improved or not, but most consumers wouldn' see 500 hours in 10 years, long after the warranty expired, so i'm guessing merc wasn't too worried about reliability.
having said that, they do work well, are good on gas, and appear to be more reliable if they haven't been beaten too hard (like most things mechanical).
i would have the powerhead rebuilt (or i believe merc offers a rebuild program on powerheads) by a good dealer and make sure you run good quality oil in the engine.