Originally when two-cycle engines were first invented, there was no such thing as 2-cycle oil..so what they used was regular automotive Non-detergent 30 W. motor oil.
This oil was mixed at a ration of 16:1 and smoked terribly. But that was all they had.
As more and more 2-cycle engines were made and they became more popular, people began to complain that the smoking was bothering them and also there was a great deal of carbon being created inside the engine and the exhaust ports. In addition, the wear to the engines was fairly excessive.
So, a new industry was born. 2-cycle engine oil development.
As time went on, research was done and additives were invented that were designed to lubricate better and burn cleaner. They had to be made so that they could be carried by the 30 W. oil. 30 W. oil has now become a "Carrier" for the additives. These new oils with the additives made it possible for engine manufacturers to cut the ratio of oil to gas to 20:1 instead of the original 16:1...but all 2-cycle engines still used the same oils at this point. It was not until much later in the development of the oils that different blends of 2-cyle oils were recommended for air cooled engines and water cooled engines...but we'll talk more about that later.
As the development of 2-cycle engine proceeded and the engines began running at higher RPM's, the need for better oils was evident. The older oils were not keeping up with the higher RPM engines and the heat that was being produced by them as well as the higher friction that was being created. The 2-cycle oil development was about to take another jump in quality. More and better additives started showing up in the 2-cycle oils. The 30W oil that was originally used is now becoming only a carrier for the additives. Less and less 30W. oil was needed as it was now becoming more of an inert ingredient and the additives were becoming the actually friction fighting agents. The ratio's of the oils then became higher and higher....next going to 25:1 then to 32:1 then to 40:1. Many of the 40:1 oils were now about 50% additives and the rest was 30W motor oil.
Today there are many different 2-cycle oils. Some of the manufactures have not kept up with the times and are still using the cheaper oils and their engines tend to show it. Even Stihl has three different oils that vary in price according to the quality of the oil.
Today's best oils are nearly all additives and are suggested for use at 50:1 ratio. They use a very small amount of petroleum based oil to carry the additives. Some people want to call them synthetic oils but they really are only partially synthetic. There must be the proper blend of synthetic additives and virgin oil to disperse the friction fighting agents and the COOLING agent additives that are now in this oil.
There have been many changes to the engines over the years, but the biggest changes have occurred to the oil. If you buy the best 2-cycle oils...such as the tested and rated and certified ECHO brand oil, you can use this oil at 50:1 ratio in any 2-cycle engine ever built. This is because it is NOT the amount of oil that is used in the engine it is the amount of the friction fighting agents and the cooling agents that actually get to the moving parts of the engine.
The best 50:1 oils also burn much cooler, will provide more protection against wear and will burn much cleaner than the other 2-cycle oils made in the past.
The main difference between the air cooled engines and the water cooled engines is that a water cooler outboard engine runs at a MUCH cooler temperature because it is being cooled by the cold lake water and does not seem to need as good of oil to give acceptable performance. They are still mainly using the older type 30W oils with a few additives in them although some of the higher performance engines are now finding the value of the better quality 2-cycle oils . They are now desperately trying to catch up with the air cooled industry in oil development. One of the reasons that they have lagged behind is because of cost. Since the outboards usually are used more and use much more fuel, their customers are more price- sensitive. DO NOT use the outboard engine oils in air cooled engines. The ash content is different but most of the difference is in the additives.
Yes there are some differences in the outboard engine oils and which additives that they use, but in most cases if you would use the better air cooled engine oils in them they would actually work better.
There is even more updated information on the internet if you want to do the research. But be careful, there are a lot of sites that are telling people the wrong information.