That's rust below the bushing on the needlebar? I think it's as likely a place as any because of that. You've made a really good observation in that everything else wiggles when you jiggle the wheel but there's no movement here. I've also heard good things about Kroil. In fact, I must remind DH to bring some home for me...
Mickey2 - I think I might get the prize for "stuck". My poor Gritzner is still stuck and I got the Facebook "1 year memory" post the other day. She's been here a year and still only a tiny bit of rock in her.
We gave her a break come fall so she could come inside and she's reassembled and in my bookcase at the moment. I know if I could get the handwheel off, I could get further but it's stuck but good. She's the only machine in the house that doesn't turn and sew.
Miriam, I had a good stuck one yesterday too. Those Rocketeer handwheels/clutches are unreal. I finally had to use a DH! Seriously, I tweaked something in my wrist trying with rubber gloves, and he came in with the rubber mallet and gave it a few taps then used the rubber gloves too and finally got it loose.