'94 GT-40, loss of power in gear

After reinstalling the engine/transmission on my ski nautique (95-96?) from a tow pylon repair, I took it out for a test run. Test run was great except for a throttle cable was routed wrong, and some occasional weird tach. readings (old problem). When I came off step at the end of the test run, the throttle stuck and I accidentally shifted into neutral from approx. 2,000 RPM. It was a bit of a clunk going into neutral. Immediately after rerouting the cable, I attempted to start, and an old recurring ignition problem reared its head. Maybe coincidence of timing, maybe not? After new plugs, spark plug wires, distributor, coil, and a careful timing job, it runs great in neutral all the way up to full RPM. But when I try to shift into forward or reverse, the engine attempts to stall. It has no power, and does not accelerate properly. Full throttle gives me roughly 1,500 RPM in gear. Engine seems to "bog down" badly when in gear.
The engine was completely rebuilt 45 hours/ 3 oil changes/ 2 years ago.
Did I just kill my transmission?
Help!?

That's the spring loaded triangular plate that's bolted to the flywheel/starter ring gear inside the bellhousing? He's fine, I was looking at him earlier this evening (actually, I guess that's last night?). I'm not sure about the pro tech ignition you referenced? Please explain?

AKhunter wrote: I'm not sure about the pro tech ignition you referenced? Please explain?

The ProTec ignition is the factory supplied ignition system that has been known to fail. You can tell if you have it by looking at the "distributor" If it has spark plug wires coming off of it, then it's not the ProTec. If it has a flat black cap and a set of coil packs behind the carburetor, then you have the ProTec set-up.

Protec system here:

AKhunter wrote: After new plugs, spark plug wires, distributor, coil, and a careful timing job,

This don't sound like a Pro Tec to me

it seems to me that an engine running at 2000 rpm under load and then being shifted to neutral with the throttle stuck would rev to the moon and you'd be more likely to have engine problems than transmission problems.

The transmission should have handled going into neutral just fine since you're just removing hydraulic pressure from the forward clutch piston

It does not have the Pro-Tech ignition system on it, it's a standard distributor and coil. I'll see if I can get pics of it later today. The fuel is a EFI system. I don't think that's a factor, but I'll throw it out for consideration.
I am the maintenance guy for a kids camp for 2 1/2 years, so I don't have a lot of maintenance history on the boat. My aircraft mechanic mind is telling me that it stinks like a timing advance issue, but I can't figure out how to verify that hunch.
I guess I was pretty tired last night, because I totally forgot to mention the rattly grinding noise that the Xmsn makes when I put it in gear. I cant tell If I'm hearing gear lash that's strongly amplified by the engine running so poorly, or if there's something wrong inside. It rotates quite smoothly and easily by hand, so I'm wondering if it's all ok in there.

Keenan,
Rotating the trans by hand really won't tell you much since the clutch packs aren't engaged so you really aren't turning anything except a shaft and bearing.

For the timing issue, get a timing light on it and see if it is advancing. The mechanical advances do rust up and need some maintenance at times.

KENO wrote: depending on where you read it's either a 94,95 or a 96 And for Pete, his distributor doesn't have mechanical advance, the timing is controlled by that newfangled "magic box" called a computer

Yes Ken, I too am confused as to the year BUT, if it was a 94 with a Pro Tech and was converted to a distributor, then the mechanical advance would be a concern and the direction I was heading.
Keenan,
We sure need more input from you.

Maybe I should change that "work Pete over" to 2% instead of the 1% of the time?

KENO wrote: I bet we'll agree right about now that we're both 100% or so confused without having anymore info

An absolute yes!!

Here are some pics of the engine. It is removed from the boat, however if the consensus is that the problem is in the engine rather than the drivetrain, I can swing the engine back into the boat within a couple of hours. Is there any other information that you guys need that I'm missing?

Keenan,
Before you go to the trouble of dropping the engine back in, why don't you remove the spark plugs and belts. Then with a breaker bar on the harmonic balance bolt turn the engine over. Ken's idea of the high rev damaging something is sound. See if there are any tight spots when turning the rotating assembly. Just a "shot in the dark"?

I talked to the dealer today, and he was able to tell me that the hull is from July of '97 based off of the serial number. I still don't know the engine MFG date, but the dealer thinks it's probably a '94 or '95, again based off of the serial number.

Last 4 of the hull SN: B797

Gary, I think the GT40 engine has a rev limiter, right?

KENO wrote: I'd probably be looking at the GT 40 manual in the reference section along with the GT 40 troubleshooting thread and checking that all the sensors are hooked up and working.(starting with the throttle position sensor} and that it's firing on all 8 cylinders.

GT40 troubleshooting thread

Pete aka "the missing link" gave you a link to the thread on troubleshooting the GT-40 a post or 2 back

I really don't think you hurt the transmission or the damper plate and just have an ignition problem making it run lousy under load and that's whats causing the gear lash rattle in the transmission.

That's my guess from a long, long ways away from Alaska