fresh water cooled, whether genset or main, means that coolant/fresh water is circulating inside the engine, not raw water and thru a heat exchnager (a radiator that works with water, not air). Raw water is pumped in by the raw water pump, and pushed thru the heat exchanger (and sometimes fuel cooler and tranny cooler) then out the exhaust.
the difference between genset and mains is that the mains have mufflers which do not trap water. Gensets usually have waterlift muffler which fill with water from the raw water circuit and that rely on exhaust pressure to get the water out. if you use a flusher without running the engine, or if you crank for long period of times, you will fill up the muffler, the manifold and send water in the engine since there is no echaust pressure to force the water out.