Thrust washer questions

I removed the propeller and thrust washer from my 25hp Yamaha this weekend for a general inspection and I have a couple of questions about re-installing the thrust washer.

The inside of the thrust washer is beveled and it fits up against the beveled section on the shaft. I'm assuming that the thrust washer turns with the propeller shaft? The reason I'm asking is that I know to lube the splines where the prop slides on but do I lube the inside of the thrust washer and the section of shaft where the trust washer installs on? If the thrust washer turns with the shaft then I wouldn't think that you should lube the section of the shaft where the bearing seats.

Do I lube the ends of the thrust washer that ride against the seal of the lower unit and the o-ring seal at the end of the propeller?

One more question: Why is there a recessed section around the end of the thrust washer that fits against the lower end seal? It almost looks like an o-ring or a seal should fit into that recess but there wasn't one when I pulled it out. If it doesn't require a seal then why is the recess there?

Thanks for your help