hmmm, with out the washer mine would not stay engaged ( well I had the thin washer there) but that should not lock it up. I might suggest a couple of thickness's of washers cut from a plastic milk jug, tthey are kinda slick and will prevent metal to metal contact and provide some friction to keep it in place. also maybe the thick washer got put in the other place ..... maybe move the one washer you have and see if that area works.... because when i used the thick washer behind the tooth wheel it kept the shoulder of the axle from seating and ould allow it to lock up.
I am just guessing now. but it is something to try.