Alloytoy,
the only caution not mentioned so far and not shown in the skeg repair video is oil in the castings porosity. Cooling the bulb will work well to keep the skeg root from overheating the seals and distorting the threads are the prop end too.
What I've had happen in one or two welds that were as close as you show in the pic, is that there were 'tears' or cracks in the cast at the skeg base that reached into the case's inner wall. They held oil, no visible leaks before I began to weld and didn't leak at all until I heated the area with the torch to get a bead. Then they gave me a little torch of flaming oil out the small cracks and an exciting time was had by all.
I'd say, because the weld is so close to the case that the first step is to clean up the skeg's base on the bulb casting with a carbide tool straight across like you'd cut the skeg off with a saw. This will clean up the 'torn' cast material and show any major flaws running upward. If you sand this edge the sander will 'smear' the flaws so I use carbide to cut the cast aluminum.
If the break is an inch or more below the gear case I don't bother to concern with an edge seal weld, but if its as close as yours- its worth looking closely at the cast edge and floating it to be sure you won't have more problems when you get ready to weld?
Then I'd bevel that area leaving a 20-30% flat land in the middle of the cleaned-up edge and weld an initial bead on that small flat edge/land -alone. The bead can be small narrow and colder than it will take to re-attach the skeg but it will 'tell' about the condition of that edge. Once you've got that small sealing bead along the edge ? flatten it with a sander (now the surface won't matter as an indicator), bevel the skeg or replacement skeg and weld.
One side, either side, weld 1/2" from either end for 3/4" to an 1" toward the center. Then turn over and 'back' those welds using the carbine burr to back-gouge all the way through the skeg's edge to the 'pure' filler metal so there is no original root left. Next, do two more located by dividing the remaining gap in the weld zone by five and welding segments 1 & 3, reversing the weld and back-gouging then welding the other side. If the welds will be less than an inch long then just divide the remaining distance by 3 and weld #2.
A (series of) wet rags will help keep the skeg from building up heat BUT!!! not dripping wet remember steam will burn you right through your gloves if you're not paying attention.
For the commercial fisherman who land their boats on a gravel beach full of salmon in our area, we used to weld a 1/2" round bar up the forward edge of the skeg all the way to the base of the bulb/gear box so the skeg would take more impact along the lead edge when beaching. I'm sure we reduced their props' efficiency but after welding a few hundred lower units it became the norm for our shop, some guys brought the engine to the shop in the shipping box for some 'preparation welding' before they were used.
Cheers,
Kevin Morin
Smacked my skinny water skiff motor with his bob cat loading rock....
Yep Welding a new one on 
I do not think you have enough skeg left to: http://www.skeggard.com/
