Matt
In simple terms 'the heavier the lube the more the drag' this applies in all engineering disciplines from heavy engineering to watch making.
I made some PTFE seals from 2mm blue PTFE sheet that sit at the end of the shaft and is held in place with the nut, simple but very effective in keeping the water out.
Stuffing glands are great in ocean going steamships but no good in little model boats as they soak up to much motor power.
Before using PTFE I used to use outboard motor gearbox grease, just a blob at the submerged end of the shaft kept my hulls dry.
When you have built the Twinkler you can stick it in the bath and experiment with different kinds of lubricants until you find one that best suits your needs.
Now lets see some production photos.
Paul