barny, yes, the takeup spring is on the tensioner:
[ATTACH=CONFIG]466846[/ATTACH]
amyjo and Cecilia S., here are pix of the stitches. Black is the upper thread. top row is with tension set at 9. bottom row is set at 4.
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Cecilia S., the only thing I haven't done is to disassemble the upper tension unit. May be a last resort!
CD, I tried your suggestion of setting tension at 9 and lift/lower the presser foot. There is obvious movement of the discs when that is done.
Y'all are great. I'll try anything at this point.
Edited to add: Yes, the thread path is exactly as shown in the user manual.
Dorothy in Denver