Well, work continues on the 8T as we have:

-Blasted, disassembled, and rebuilt the Zenith carb- Carlos at www.carbparts.com was very helpful and shipped the kit the same day of the order, and at 1/3 the cost of CAT. This is the place to go for these kits. I do not recommend Foley engine.
-Cleaned, painted, and re-assembled the pony air cleaner
-Replaced some switches and cables.
-Removed dash, air stack, cleaned, and replaced governor and starter belts, plugs with the NGK AB-6 (NAPA avail.) as suggested by Old Magnet in prior posts.

Waiting for a replacement exhaust pipe from www.tractorparts.com in Idaho. John parks was very helpful

The pony starter turns over fine, pony has good compression, a spark on both leads, but didn't start. We adjusted both jets, the choke and throttle, and after draining the flooded cylinders, had to give up for the day. I suspect the magneto switch is bad or the spark isn't strong enough- we'll test both next time.

On another note, the pinion/clutch was engaged when we started turning over the pony and it turned over the diesel as well, and even though I moved the clutch and pinion levers, it wouldn't disengage. Is there something we're missing here? Or does it have to be at full running speed to disengage? It has been sitting for some time.

I'll post pics next as I'm still figuring out how to do it.

Does anyone have suggestions? Thanks.

Once the pinion is engaged it will stay that way until the main starts. Should not be a problem though.

It is a fact of life that a gasoline engine will run if it has gas and spark, maybe poorly, but it will run. If there is good FRESH gas in the tank and you found lots in the cylinders then I would think you succeeded in flooding it which kills the spark. Next time before you crank it over pull a plug and see if it is dry. If so crank engine then pull plug if no start and look for wet. If wet it is probably a weak spark. Try closing the plug gap to .022 to .025. You can leave the choke open and slowly close it while cranking to reduce the possibility of flooding.

It doesn,t matter if the pinion is engaged or not if the clutch is kicked out. Make sure the clutch lever is pulled back toward the diesel engine & if it doesn,t release then the clutch must be hanging up or plates stuck from setting if it was for a long period. Check and make sure it has oil in the clutch compartment too even if it releases when you try it. There is a level plug so it,s not over filled.If you can,t get it to release then you,ll have to remove the 3 bolts that holds the clutch lever on and remove it so you can look inside the housing at the clutch discs and see if things are froze up in there or what.

Something I learned from an old catskinner about pony engines that are reluctant to start is to pull the spark plugs and squirt a LITTLE ether in the plug holes, replace the plugs and crank it over. If still no pop, it could be the plug wires in the mag cap are backwards, swap 'em and try again. If still no pop, time to start a more thorough check.

As for the clutch, too heavy an oil in the housing can cause it to hang up, as can too tight of an adjustment. I use either power steering fluid or 10 wt oil diluted with a little diesel and adjusted just enough that it doesn't take a lot of pressure to engage. I'm not familiar with the grader application but on crawlers there's a little plate on the clutch housing right above the pinion. It can be taken off and with a screwdriver, you can pry the pawls to disengage the pinion.

Check the top of the bellhousing/transmission case just above the starter pinion.
There is a threaded plug that can be removed to mechanically release the clutch dogs if you wish to disengage.

Thanks. I'll open the inspection port and see if they are bound, and release if I have to- is that the 'clutch release lever pins' section I see in the OMI, Old Magnet? I found the inspection port with the three bolts above the pinion.

I already replaced the wires with new ones, gas straight from the pump through the 'new' carb. and from a clean gas can, and plugs gapped to .025.

I have pics of all of this, but every time I try to post, my pics are 1200x1600, and they exceed the limit for uploading. I've tried rescaling the pics in MS paint, but I can't get it right. Does anyone know of an easier way?

Thanks much.

It,s not going to help to release the pinion latches if you want to turn the diesel over after you get the starting engine running if the clutch is not working correctly.

Seems to be some confusion:)
The three bolt cover is on the side of the pony clutch housing (has lever).
There is a small two bolt cover just above this where the pony clutch is adjusted by pulling back the spring loaded pin, rotating and engaging the adjustment plate with all the holes. Also can access with the three bolt cover off.
The pinion release "dogs" or "latches" are accessed through the screw plug. Only need to bump one of the latches as they are geared together.

There is no fuel pump.....assume you mean tank. That carb may be flooding. Got the float level set right? and is it shutting off?

Can't help you with your picture sizing as I run different program through HP scanner. Someone will know.

If you wish, email your pics and I will post them until ya get it sorted out.

I'm impressed with your jump right in and get er going:)

A weak pony sometimes won't start with the drag of the engaged pinion. If you disengage it from the flywheel by punching the back of one of the latches through the plug on the clutch housing that OM mentioned, the small amount of clutch drag in the pinion clutch will be even less of a load on the pony because the pinion is free to rotate.

You want to adjust the pinion clutch (left hand lever) so it snaps forward quite easily. No need for a real firm snap over-center on this one like a transmission clutch. That should give you relatively less drag in the clutch disks when the clutch is disengaged. The light oil or transmission fluid helps here too.

On the float adjustment, take the top of the bowl off and flip it upside down so the float rests on the needle seated in the valve seat. The gap between the float and the bowl cover should be even along the float from the hinge out to the end of the float. This works fine unless you have a heavy float for some reason.

If the float looks ok, check the needle and seat for debris, improper installation etc.

Initial adjustment on the two mixture screws is about 1 turn out on the high speed needle on top of the bowl and 1/2 turn out from firmly seated in on the idle mixture screw on the side of the carburetor body.

One final tip, hold a wire off the sparkplug near something so you can see the spark and open the petcock on the same cylinder so you can watch the spark and listen for the whoosh of the compression and make sure they are the coming at the same time. If not, swap the wires in the magneto cap. Unless something is broken or the pony has been reassembled incorrectly, you can only be out of time by 180* so swapping the wires will take care of it.

final final tip. If you have flooded it, the oil in the pony motor may be diluted with gasoline already. Not only will it be bad for the bearings to run it with diluted oil, it will start better with good oil.

I sent the pics. to Old Magnet. Hopefully I'll figure out how to resize the images soon. Thanks.