I've been going down as low as a 35A Jeti flight ESC to run a 12-cell, 700 motor, stepped monohull.
The ESC is made watercooled and runs for years now without any problems.

Only on a well set-up boat will you get away with it, if you don't get the set-up right, the thermal overload will cut in, despite the watercooling.

I agree when you say it's on the edge, but hey, if you don't have the money for those big ESC's?

Regards, Jan.