I don't know why I didn't see this thread before as I am experiencing the exact same problem. Cannot shift into 1st or reverse with the engine running. Works fine with engine off. My car is a 64 Valiant, 225, 3-on-the-tree, not running when I got it and was last on the road in 1981. I rebuilt the engine and got it running 4 years ago and have put about 10,000 miles on it. I remember the crank bushing looked and measured OK during the rebuild so I didn't change it. I really started to have problems after fun racing it 2 summers ago (18.50) when it wouldn't shift at higher RPM's. I like the originality of the manual 3 speed but the linkage is abysmal so I've collected all the parts to do a 4 speed swap including a 65 3.09 ball and trunnion 833. Hopefully over the winter.
Anyway, sounds like the old pilot bushing is my problem too. First time I ever heard of this and I bought my first Barracuda in 1969. Oh, well, live and learn.
Rustycowll69
The way this is supposed to work is you pack bearing/crank cavity with grease, find a close fitting rod that fits the ID, and pound on the rod. It is hydraulic pressure acting on the back surface that forces the bushing out. You do not pound directly on the bearing, just create a piston to develop pressure to pop it out. I never did it but imagine it's like hitting a jelly donut with a hammer.
I have a lot of Chrysler history books and know that Chrysler engineers actually invented sintered bronze bushings back in 1930. It worked so well that a separate company was formed and the brand name chosen was Oilite. Oil is impregnated into the bearing cavities in the manufacturing process and with all due respect to AJ/FormS, grease is not recommended.
Oilite - Wikipedia
@Duggie, sounds like you are well on the way to getting your car running again. Did you ever get your bushing replaced?