I have one of these, and I spent a lot of time freeing it up. Right now I'm on a very slow connection, and can not post pictures. The screws are not attachment screws, they are detainers that grab the clutch washer. Like Cari said, one has a tip, the other doesn't. You don't have to screw them all the way out, just far enough to unscrew the silver clutch knob. The clutch washer is fixed to the clutch part of the hand wheel with rivets, so that won't come off. You screw the knob on nice and tight, and should get solid clutch. Screw the screws in, back the knob off to "bobbin mode" and see if it frees. If it doesn't, or something feels all wrong, change the screws around. You probably have the tipped one in the wrong place.
Its not clear if the machine spins freely unclutched from the motor. That would help a lot in diagnosis.
My machine is equipped with a "world wide" voltage selector, maybe they were all the same from the factory. In that case, check if there are rf capacitors in the circuit, either in the foot controller or near the motor. I had to operate on mine, but I've done so many of my European machines that I can't remember where it sat. They are electric components that prevent motor noise to disturb radio reception. Usually round cylinders, look like AA batteries. They get old and cook out and disturb the function of the controller. If you find any, just take them out, no need to replace them. You should check this anyway, because you will not get proper speed control if you have this problem.