Are you doing this testing in a bucket or small tank? Too small a tank will
cause enough turbulence, even in neutral, that the water intake may get
intermittent supply. Put the motor on the boat in the lake and try it
again. The comment about checking it in neutral refers to the fact that you
shouldn't put an engine in gear, lean over the back and open the throttle.
It's dangerous on account of you would get thrown out the back and, at a
minimum, laughed at.

The 2.5 hp is very low power so you could tie the boat to the dock and try
it in gear, it won't pull too hard.

From your descriptions it sounds like everything is fine. The poster who
suggested taking it out and seeing what happens was correct. If you want to
avoid potential paddling, tie it to the dock and run the motor in gear
until you feel confident it runs well and then take it for a ride.