looks like all the Kenmore fans moved to the VSS board.
Sounds like your machine is still not timed correctly. So the takeup lever is pulling up slack in the thread BEFORE it's slipped off the end of the hook. There is usually only a very specific spot for timing to be correct - too far one way and it won't catch the thread from the needle, and too far the other way and it won't slip off the hook (usually causes broken/shredded thread).