In response to Bill Atkins:
Water doesn't compress. The pump simply sucks water in and increases it's velocity. The nozel then decreases the apeture which creates pressure as the large volume of water increases speed to get out of the smaller opening.
Since water doesn't compress, the pump can suck and blow just as efficiently at 1,000ft as 10ft. Certain other fluids have been created that do not compress, but also lubricate and protect. These hydraulic fluids would be the best thing to seal an electric motor at depth. As long as the seal can keep the fluid in at sea-level, it should be capable of doing the same when submerged. Then a seal much like a dripless packing tube found on inboard-powered boats may be an adequate seal.
I would still rather have two pumps on board, in case one failed, and to give added manueverabilty. Also I'd want to be able to aim the nozels.
My question, however, is this- would a jet stream be as efficient as a propeller AT SLOW SPEEDS? The benefit of a propeller is that it can be tuned to the work it is doing. Angle, pitch, diameter- a psub like ours will have a lot of resistance and won't be very fast.
That being said, consider this: A hydraulic pump mounted inside the hull, driven by an electric motor. This pump works on a closed-system, and recirculates hydraulic fluid which drives propellers. Again, I'd choose two pumps (one for each side, which provision to drive both props off just one pump), for added safety and manueverabiltiy. You don't have to pressure-compensate anything, and no moving parts are exiting the main hull, just a few pipes with cut-off valves.