Here are shots of two different Willards with two types of exhaust setups.
The one has exhaust going directly to a downpointing nozzle on the Konrad drive, this I assume is similar to your etup. Underwater when idling, pointing Down at the water stream flowing under the boat when planing.
This is my setup and frankly I'm more concerned that the exhaust manifold is not high enough to guarantee no water intrusion, espec when at anchor fishing, etc. and engine not running.
The second setup uses a waterlift muffler and exhaust is above waterline. The waterlift is interesting and I'm wondering whether this is older or newer setup on a Willard if anyone knows, please tell me.
I would think it should also be quieter, Not easy to find room for however.
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