water intake

How high should the water intake on the engine be.. I am still trying to set up my 97 200 johnson on coral 202.. One post said I should be able to run it up even with the bottom of hull , tryed that and had to much blow out.. I have only been able to get 5400 rpms and 51 mph out of this boat with a full torney load and a tank of gas with two heavy riders.. I am running a 22 p gade with extra cup for bow lift .. Any help will be greatly appreciated...