Don't know a thing about darning, but the lever and other functions has just been discussed here.
http://www.quiltingboard.com/vintage...a-t275180.html
It's a little unclear what what you problem is. The darning position shouldn't affect the looping action. Question is, did you do any stitching at all after you broke and replaced the needle? I suggest you go back to basic sewing settings, and start from there.