I hope you are kidding about extinguishing burning magnesium with water. It burns too hot and will actually split the water into hydrogen and oxgen. These will then explode (forming water again).

As a side note. I eventually pulled my T-Case and rebuilt it (chewed up shift forks were causing it to jump out of gear). When I replaced the back half of the case I found a THIRD hole that had formed (after I JB Welded the first two). I put in a Kennedy setup to prevent a repeat on the new back case half when I reassembed the case. The JB Weld (with RTV underneath) held for a lot of miles but once I had one hole the oil pump kept working it's way through the rest of the case over time.