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If you’re pulling the transmission you might wanna just read up on it.https://www.thisoldtractor.com/guzzitech.dk/pdf/gearbox-rebuilding-john-noble.pdf
This sounds like Mike from Augusta's friend in N.GA. Finally got to look at it eh? Make sure linkage is not hitting frame first to not allow full swing. You can move Adj on back 1/16-1/8 turn no more either way, just enough to see if it helps. I would mark a line on the head so you don't go too far. The spring can come off if you go to far so be cautious. Make sure all pivot bolts are snug & secure and lever doesn't hit frame by swingarm pivot pins. Triangle part of frame.
You might want to do a search here for “crabbing the frame” to learn how to get the tranny removed. And get at the back of motor.Are you planning to replace the engine rear main seal too? You are sure the leak is motor oil not gear lube, right?How many miles on this beast?
IF either of the Clutchshaft (input) or Layshaft (output) bearings have started to go south it could possibly result in the box locking up. Either of the bearings collapsing could cause shaft misalignment, or just general mayhem. The Phenolic/Nylon/Plastic bearings for both these shafts shafts support the majority of the load. If it was me I wouldn't contemplate riding the bike until sorted, if that's the cause. I'd get rid of these bearings and install the all metal type that I mentioned in the write up, methinks that's what BC's sage advice might have been alluding to. Many thanks for the kind words, the whole thing was more of an article that ended up going rogue.John
I did pull the clutch rod and found only one of the little flat bearings in place, I thought there were supposed to be two. As I removed the rod and the little flat bearing remaining started to drop all the little rollers and then when I got the rod all the way out, there was a mangled piece of metal about 30 millimeters long and about 1 in diameter. Also, gear oil started to leak from the hole.