Okay Muv, I've just spent 20 minutes staring at my machine trying to figure out what the problem could be with yours. If you have time, let's attack this one step at a time.
1. Turn the stop motion wheel to bobbin winding mode. Now inspect the set screw in the stop motion wheel, on the inside. Is the tip of the set screw coming into contact with the washer? Are you able to get a playing card or scrap of paper between the tip of the set screw and the washer?
2. If your machine is belt-driven, remove the belt. Turn the stop motion wheel to bobbin winding mode. Turning the handwheel manually, is the problem still in evidence?
3. Remove the stop motion wheel, the washer, and the handwheel. Lay the handwheel on the table, standing up as if the handwheel itself was a little table. Now lay the washer into its "bed." Rotate the washer with your finger. Does the washer rotate freely and smoothly?
4. Place the handwheel back on the shaft, and slide it firmly into place as far as it can go. When it stops, do you hear a clean "CLUNK" of metal-on-metal? Or is the sound adulterated, like metal hitting mud?
We will get to the bottom of this.