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My statement about single point threading was wrong. Thanks for pointing that out.
My lathe has a handle/lever that activates the clutch, not a star knob.
I wasn't very clear in my original post so let me see if I can give a better description of what's happening. When the feed change lever is in the top position (longitudinal travel) the lead screw is engaged and (because the clutch isn't working properly) cannot be disengaged. The same condition is present if the feed change lever is in the bottom position (cross feed travel). When the feed change lever is in either of these positions it's like the carriage and cross feeds are in 'direct drive'. The only way to use the lathe is to put the feed change lever in the neutral position and do everything manually, no power feeds.
I hope this description gives a better picture of what's happening.