I masked everything EXCEPT both the water pipe ports on the side of the block... Is there a way to remove this paint or is it fine? ...
For the port hole...
I would NOT use a blade, scraper, or sandpaper to remove it.... don't want any of that getting into the coolant passages.
I would use lacquer thinner or MEK to soften and liquefy that paint and use a piece of cloth (t-shirt or shop rag) wrapped around the tip of phillips screwdriver, carefully pulling it out.
Before I'd run a tap through threads, I'd make sure they bottom out and NOT go through into the coolant passages.
Geezz.. great paint job... I wish I done that to my block. That will probably last the life of your engine and withstand all the degreaser and carwash spray cleaning you can put it through.