I guess my point was that they will sell you a plug, but are not taking any responsibility for suitability for a specific purpose, no liability in case the magnet ends up in a gear tooth, etc. I suspect it would be safe if some protection is applied to prevent galvanic corrosion and the magnet is secured in place.
The photo is a submersible planetary gear drive for a proprietary piece of equipment. I suppose a little imagination regarding what could possibly run under water and need over 1,000 ft/lb of torque through it (24/7/365) might lead someone to the specific application, but it's not a subject for general discussion. However, I CAN tell you that it's not a torpedo, since no one would probably care about servicing it after is had been submerged once.
Your information regarding the thread size was invaluable. I am considering having some bronzed pieces made up with our "standard" magnet installed in them because I know they are bullet-proof and won't erode an aluminum case. Actually, I am thinking of using both of the drain and fill holes and installing a borosilicate sight glass
, since Hydramatic decided that we no longer need a dipstick. If it works out I might be posting information about the parts and materials used.