Well I guess first you have to drained the gear lube or whatever might be in the gearcase if you haven’t done that? If it is full of water or goop the driveshaft might be seized in the upper or lower bearing housing? The propshaft would still turn freely in neutral. Of course the powerhead could be seized, rusty cylinders, etc. only letting it turn a partial amount, but neither would keep the gearcase from coming off. Unfortunately then we have to go to the splines of the driveshaft being stuck in the crankshaft, but that wouldn’t keep the driveshaft from turning. It would take a combination of two of these to cause your problem. Just trying to give you some of the options from my perspective. I am sure others will be along if I forgot the obvious. Hoping it is something easier/cheaper to fix. Those are great little motors. Plenty of parts available.

Dan in TN

Well, you inverted the engine, but you didn’t bang down on the gearcase or flywheel, correct?? If not, seems very unlikely that you caused damage that would jam it this way…
I’m thinking you may have a simpler problem. Right around your engine’s vintage, the design of the exhaust housing was changed slightly. OMC put a little "cup" up around the lower seal pieces to retain them up next to the powerhead when the gearcase is removed. There is a little slot that allows the driveshaft roll pin to slip down out of the cup when the gearcase is pulled down. BUT, the roll pin must be lined up perfectly with the slot in order for the gearcase to come down.
So, let me ask if you have gotten the gearcase to move down from the exhaust housing at all? If so, the driveshaft roll pin might be jamming on the exhaust housing cup causing the binding your are experiencing. And, because the broken bolts shanks are still jamming the gearcase in place, it is very hard to get the roll pin lined up properly so the gearcase can be removed.
Just to be safe, you may want to consider removing the powerhead, which is pretty simple on this engine, provided you can loosen the powerhead bolts. If the powerhead bolts are stuck, I guess it is best to leave the powerhead alone. I surely don’t want my suggestions to cause more problems for you. Have you tried heating the gearcase to loosen the salt around the broken screw shanks that are holding the gearcase in place? You will probably need a big boy torch for this operation, the little propane torch won’t be much help. Gently rocking the gearcase while an assistant heats the gearcase will help release it from the broken studs. Once the gearcase pops down a bit, don’t forget to disconnect the shift linkage! When the gearcase finally is released, you will notice that the roll pin has just been sheared off even with the driveshaft, no big deal.
Again, my recommendations are "assssuming" that you have the gearcase pulled down a little bit from the exhaust housing, and that the roll pin is jamming on the exhaust housing cup.

Well, not quite…#6 is above #8. The slot is actually in the exhaust housing itself. So, #8 roll pin has to be lined up with the slot in the exhaust housing cup which is just below the roll pin.
Like I say, forcing the roll pin past the exhaust housing cup when it is not properly aligned will probably just shear the ends off the roll pin. No big deal. Again, I am hoping this is all that is wrong, and am assuming that the gearcase has been pulled down from the exhaust housing just a bit, so the roll pin is jamming on the exhaust housing cup when he tried to rotate the flywheel.
At this point, it is probably best to simply remove the powerhead, but I don’t want to introduce more problems by stuck powerhead screws breaking off.

Thanks Mumbles, your picture is worth much more than my words!