I just received my 1-piece raw water pump repair kit that includes the impeller, bolts and rear housing.
When I look inside the housing, there is a sharp plastic ridge on each side of the water ports, right where the impeller rubs against the sides.
Is this normal? I feel like it's counter-intuitive having the impeller rubbing against a sharp edge. Should I sand this down or leave it alone for some good reason?

I would think it would tear that impeller up depending on the rotation of the blades. Man, i would send it back or at least call up who you ordered it from and see if that's normal. What does the old one look like? i'd at least compare the two and then make your choice, but i wouldn't install that without checking into it first.