OK - after spraying the vibration damper with WD-40 and letting it sit over night two light taps with the mallet did the trick :-) It's pretty obvious with all the stuff removed and a clear view that the pump is indeed the source of the leak.
I removed the t-stat and now I am finally working the water pump off. I am a little worried about the coolant pipes so I sprayed some more WD-40 in there and letting it sit overnight again too. So basically I just need to bolt everything back up tomorrow. I think it will go much faster since I won't have to wrangle with getting old stuck hoses and shit off. I have done a fair amount of cleaning and still need to do some more (hard to stop once you start, lol). A clean engine is a happy engine!
One last question. I have a choice of either using the standard Graf gasket or the Green VictorReinz/CRP-Contitech one (has lines of sealant on it) here is a pic:
Thoughts? I am leaning towards the green one...