Check the Cam Bracket...
Sounds to me like the Cam Bracket needs to be replaced. The Cam Bracket is the little part that pushes the gears apart when the peddle goes from Off to On. It wares down over time. If you take the transmission out for the base unit, you unscrew the control peddle and as you remove the peddle the Cam Bracket is on the peddle. It sits loosely, so it is easy to replace. You can get one on eBay fairly easily.
Justin