A while ago these Tie Bar Hendey were everywhere so every time I seen one I purchased it. Seems no one wanted them and most of the shops were buying gear driven machines. I didn't have a machine shop but liked to work and run lathes, my father was a tool and Die maker. I guess it was in my blood! I would buy them fix them up for the hobbyist or guy that wanted a lathe in their garage or basement. I would keep the best ones for myself only keeping one of each size and sold the duplicate. Eventually I started a Machine shop and I too graduated to the gear driven lathes. I currently have 4 Gear drive Hendeys. Would have had 5 but sold my 16" Hendey to make room for a 16" P&W.
Back to the topic, I onetime bought a Hendey that did as the OP mentioned. Someone welded then re-cut the dogs on the reversing mechanism, possibly because they were rounded and slipping. Also the clearance between the gear and the hub was almost zero. In doing so the faces of the dogs on the bevel gears and the driven shift hub had a "positive rake" so when engaged the dogs pulled themselves together. That lathe did have a thread dial so the half nut I assume was used not the reversing mechanism. However if disengaging the feed it was difficult and more so when the load was higher like in threading. Simply because of that "positive rake". The force needed would cause overshoot and instead of neutral it was pulled or pushed into the other direction which too had the dogs cut positive and whey would also be hard to disengage. I re-cut the dogs neutral though with a very slight positive angle. Worked fine, I removed the thread dial and mounted it on one of my Keepers. (Lathes I kept for myself)