I pulled my motor and split the cases. Turns out the rear shift fork had been rubbing on one of the gears. It was eithe mis alligned or fork was bent. I bought all new both gear sets, shift shaft, shift drum and forks off of a 2006 for $73. That and a gasket set and seal kit and I was only out $138. Just got it back together last night. Will be putting it back in over the weekend. These things are easy to work on. Who knew you could replace the innards of the tranny in a day??
As the guy's on here will tell you, you need to tear it down to find out whats wrong.... There isnt really a whole lot to them once you get going.