I have just put the case back together on the 125. I had to open it due to the shifter becoming stuck in 3rd(?) gear. This was caused by the chain coming off and getting balled up behind the drive spocket. I checked the countershaft using V block and dial indicator and it is not bent, the gears and shift forks are ok too. I have now put the case back together and put on the shift leakage and other related shifting parts. I bench tested it by attaching the shifter to see if all the gears work ok. Everything shifts find but when I put it in the neutral position, I still have gear engagement when I turn the drive gear behind the clutch. In other words, the gears seem to be still engaged. I have checked the shift drum location thru the hole and see that the brass contact ring is visible (also checked continuity with DMM), so I know that the shift drum is in the right location for the engine to start. Is the trans still supposed to be "engage" in the neutral position? The Trx125 has the sub transmission and the following gear positions, from botton to top: R,N,Super low, 1,2,3,4. Also the clutch is automatic. I have the honda factory manual and it does not give me any comments about the neutral position. I would appreciate any info. I don't won't to put this engine back on the chassis only to find out that there is a problem with the shift drum finding neutral.

 

In some trannies, the gears always turn, nuetral or not, it's just whether the counter shaft is locked to the gears with the synchronizer.