Your engine, like all outboards and I/O's today, has a cone clutch.
Come clutches do make a grinding noise, that's the bad part about them.
The good part about cone clutches is that they will outlast, by many
years, the old kinds that some manufacturers use to make that made no
noise at all. What your probably also doing is shifting slowly, because
your probably thinking it's like a car when you shift, and it's
definately not. A cone clutch should be pushed in and out of gear
without hesitation. Putting it in and out of gear slowly will lead to
an early death. The noise your hearing is perfectly normal, and
indicitive of a properly shifting engine.

Forget about the prop change, the dealer is looking to make a few bucks
off of you, it's not going to change a thing, except lighten up your
wallet.

John