not familiar with your machine ,but on my Gammill, if there is skipped stitching the first thing I check is whether it leaves needle holes or if there aren't any--if no holes that tells me to check the encoders--are the wheel rings needing replacement (even just a little crack in them can have impact) or is a thread wound around preventing them from reading the SR? If there are holes, then I usually check height of take-up bar, needle placement, tension, etc. since you mentioned that it appears that 2 threads are coming through and needle unthreaded, check the check spring--I was told by my tech that if you use your machine frequently, the check spring needs to be changed about once every 12-18 months as it loses it's springiness. Good luck!