What year, how do you engage it? Later styles were live, older ones were not and were completely different setups. Need a bit more info.
 
you have a internal problem , i never run across that one ,if this dc has sat outside and no one engaged the shifting lever ,could simply be the shiftin shaft is rusted bad ,,try sanding it down and using penetrating oil ,,.. is the tranny full to fill level , is there water coming out of the drain plug when you loosen it to the last holding thread ,,.? , i would bet you will have to pull the entire steering housing and top tranny plate off ,,.. then it will be self evident .
 
Adjustment is too tight on your clutch. PTO is not live so it keeps running much easier than the tractor will move. If you put tractor in gear and engage pto it will stop rotating. Obviously the tractor will drive away if you push the clutch lever in, and the pto will rotate.
 

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