Quote:

the clutch will not fully disengage the tranny when shifting to 1 st. or 2nd. from idle (e.g. the engine dies).



Reading that as "the engine dies when shifting to a gear", the sidestand switch might be sketchy.

Cable Adjustment:
Loosen the two 12mm nuts on the cover side adjuster. Retract fully the bar side wheel adjuster, then bring it out a full turn. Use the lower adjuster forward nut to take the slack up until you have a bit more than 1/8 play at the lever. Tighten up both nuts. Fine tune the adjustment (if needed) using the upper wheel-adjuster.

NOTE: The upper adjuster must never be left with both slots lined up together. A frayed cable issue will ensue.

Unlike hardleys, cable adjustment is the only way to adjust our clutch. Should a major issue arise that would be a concern inside the clutch cover, it may have to do with the spring on the Throw shaft, or the basket push rod might have failed, or the throw out bearing itself. Odds are against this.

Worn friction plates is also unlikely as you have only 7K on them. However, should the clutch cable have been too tight over those 7K miles, then the plates might indeed be a factor. Worn plates make for a large friction zone and require a critical adjustment of the cable.

Blowing gravel off rural roads