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I started on the front of the truck the other night doing some disassembly for prep for more sandblasting. Anyways, I cannot get the winch to unspool. The PTO lever is in neutral (center position), and the arm on the winch is moved towards the passenger side of the truck. The drum will roatate a small bit back and forth, but seems to be catching on something. I was hoping to unspool it so i could clean it up and put the new cable on. Any ideas what the issue could be? The arm on top is very very hard to move as well. Thanks in advance.

also...The truck is not running at the moment due to I am replacing all the hoses, plugs wires...etc on the engine.

Has the drive shaft to the PTO been removed? May be simple enough to just put PTO in neutral if it's still connected. If not, the lever mechanism may not be disengaging all the way so you might try having some rotate the drum while you move the engage lever to see if it drops into free spool.

The PTO shaft is still connected. Ill try moving the PTO lever to see if i can get it to drop into neutral. Thanks for the advice.

PULL OUT THE BRASS PIN FROM THE FRON U JOINT. THIS WAY IF IT STILL DOES NOT UNSPOOL. YOU WILL KNOW THAT YOU PROBLEM RESTS WITH THE WINCH AND NOT THE PTO, SINCE THE UNITS WILL NO LONGER BE CONNECTED. ONCE I EXPERIENCED THE SAME ISSUE, AND IT TURNED OUT THAT THE WIRE WAS LODGED INSIDE ITS OWN COILS. A VERY SHARP AND STRONG PULL DISLODGED IT AND FREED IT.

Most likely problem is this, the drum clutch is not disengaged. Most likely reason is the shift fork is loose on the shaft due to the set screw backing out. This is a common issue that happens frequently when someone fails to secure the set screw properly. The only way to fix it is to remove the winch from the frame and pull the clutch end housing off to gain access.

You said you could hand turn the drum a little in both directions, that's the way it should be, however if the clutch dog is not moving far enough outward on the shaft to fully disengage the drum when you move the handle, you get exactly the symptom you described. What is happening is the handle shaft is slipping in the fork bore due to a loose or missing set screw, or the fork could be broken, thus not pulling the clutch out of engagement with the drum. This makes no difference what so ever to the worm or bronze drum shaft gear in the opposite end housing, moving the worm shaft or the drum shaft will have no effect at all on your problem.

I second what Charles said. My declutch handle is a tad loose on my LU4. I have to move the handle/shaft beyond the original handle engage and disengage points to to use the winch. It is on my to do list.

Messing with the PTO won't help. The bull and worm gearset in the LU-4 has a low enough helix angle that I believe it is a locking type gearset. You can tug on it all you want and it wont release unless you turn the worm gear.