That model is fixed axle, no differential. The wheels spin so the friction disk is away from the drive plate.
The chain loosness is ok.
With the drive clutch out the shift should go from reverse to high easily. With the clutch engaged you should not be able to move the gear lever.
With the tractor section opened. Lower the drive clutch partially so the friction disk is close to the drive plate. Tape it in place. Put it in reverse and note how far away the disk is to the drive plate. Spin the friction disk to see if it changes distance from the drive plate checking for a flat spot. Do the same thing in each gear working up to the highest gear. The friction disk should stay the same distance from the drive plate through the range.
Tape the handle down with the shift in reverse. The friction disk should be very hard to turn. Go to high gear and do the same. The force to move the friction disk should be about the same, if you can move it. Twist the wheels for grip to try and make the friction disk slip in reverse and high.
Check that when in reverse the friction disk is too the left (or right) of center and when in first your on the opposite side of center. That will indiate your not going too far in high to one side bumping into something.
Shake the friction disk axle looking for play.
This message was modified Jan 2, 2011 by trouts2