I agree. marine engines and components have been made for use with 10% ethanol fuels since the late '80s or early '90s. I use ethanol fuel in my boats and have not had ethanol related problems. If you have fuel system components made from modern ethanol resistant materials and you don't leave fuel in your tank for more than six months at a time, I don't think you'll have problems from ethanol fuels.
The one time I had water in my fuel, it was in my flats skiff. Just as you describe, it had a foamed in aluminum tank that deteriorated due to crevice corrosion. Water seeped into the tank from the saturated foam. Never had noticeable fuel in the bilge, just a slight smell of gas.
That being said, I think ethanol as a fuel additive is purely a political phenomenon. There are better products for controlling octane, and ethanol contains less energy (btu/gal) than gasoline, so fuel efficiency suffers. But as long as it's the only product that's readily available, I'll keep using it.
Dave
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Blue Heron Boat Works
Reinventing the wheel, one spoke at a time.
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