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Hi Sonar Inrunner brushless have an outer case which remains static just like a brushed motor. Outrunner brushless have an outer case that revolves around the central core which remains static. The revolving outrunner case forms a flywheel which is beneficial when driving a model boat prop where the water resistance is greater than a plane propeller in air. The effect lessens with larger motors used say for fast speed boats.
Doug That link appears to be to a file somewhere but there is no url.
Hi Sonar I have used both in boats and with no watercooling. No problems with both types. The in runners are good for replacing brush motors as the 35mm brushless motor are the same bolt holes as the 540 brush motors. My first brushless was a Trackstar 17T 2400kv into an old rc car, 90watts to 550 watts, turn it into an insane rocket. The main brushless motors we use in the boating club are Hobbyking 3639 750 and 1100kv, 3648 1450kv and the outrunner D3548 1100kv with a 2 blade 40-50mm props. ESC's are the car 60 and 100 amp which handle 2S to 4S Lipo batteries.