Small Engines (Lawn Mowers, etc.): small engine wont start, engine crankcase, starter solenoid

Question
Marc I have a yard machine by MTD with a 17hp ohv techemseh engine it is approximately 6years old. I just bought it used. I completly serviced the tractor, cleaned gas tank, new fuel filter,new plug new air filter,changed oil and filter new battery,had the starter rebuilt, replaced starter solenoid, and a few other small items that does not pertain to starting the engine.  My problem is that when I turn the key to start the engine the fly wheel will only make about one revolution  then it will stiffen up. I can turn it with my hand past the stiff spot and when I do I can hear the compressed air sputtering out the aif cleaner housing. It's almost like I have way to much compresion  and the starter can't spin the flywheel past that point. If I take the spark plug out and hit the key it spins over nice and easy. I have had the tractor running and it ran  beutiful but now I can't even start it. Also when the piston is at top dead center should the magnet on the fly wheel be in contact with the magneto or (horseshoe thing) because it's not. Any help is greatly appreciated Thankyou.

Answer
There should be a 0.010" gap between the flywheel and the armature.  If the engine spins freely with the spark plug out, one of three things may be happening.  The engine is hydraulically locking because the carb is allowing fuel to fill the cylinder because of a problem with the inlet needle and seat or the float.  In that case, there should be raw fuel spitting out of the plug hole when you crank it over with the plug out.  The second thing may be the oil level is way too high and is hydraulically locking the engine crankcase.  The third thing may be the fule pump, if equipped.  A defective diaphram in the pump may be allowing raw fuel to enter the crankcase via the impulse passage and hydraulically locking the engine crankcase.  I don't suspect any issues with a mechanical lockup as the engine spins freely with the plug out.  Hope this helps.