350 rancher clutch question

I have a 2002 350 FE 4x4, electric shift. It shifts really easy into reverse, but it takes about 4 tries to get it into 1st gear. When you put it in reverse, the machine lunges and creeps HARD even at idle. I put brand new brakes all around and it would not totally stop it with all the brakes on full.

So I tried to adjust the clutch to back it off, but the adjustment bolt was frozen. So I took the front cover off and am working to get the adjustment bolt loose, and looked around. The clutch plates look really good, but there is no space between the plates. I tried to move the arm with the roller on it, and it only moves maybe an inch left and right, and feels tight. There is no slack in the plates that I can tell. I read the Clymer manual and watched the only youtube video that showed anything.

My question is, what movement takes the pressure off the clutch plates and do they get space between the plates when you back it off? Can I push the center of the clutch pack?