The manual for my 35E absolutely stinks. It reads as though it has been translated through 4 different languages before finally arriving at English, and each translation was done by a non-native speaker of that language.
I think they changed something about the clutch engagement and/or brake engagememt/release mechanism between the Model 35E (which I own), and the 35M. I can't recall exactly what it was, but the 35M design was a definite improvement in reliability.
I've had that problem with my 35E in the past. I'm going from memory, since I'm not at my winch right now, and I'm not sure if my setup is the same as yours, so take this with a grain of salt.
When you pull the brake release rope fully, the brake should latch open. On my winch, there is a small shaft - maybe half inch diameter (it may have a spring wrapped around all or part of it??). The latch mechanism is a plate with a hole which the shaft passes through. The plate moves slightly and cocks on the shaft slightly, grabbing it and holding the brake open. When you pull even a little bit on the line to start the winch moving, something bumps that plate and releases it allowing the brake to engage again. Pulling further on the line disengages the brake, holding it in the open position, a little further pull on the drive line engages the clutch, starting the winch moving.
So my first question for you, is: Is your brake latching open? If you pull the brake rope as far as it will go, and release it, does the brake lever stay in its inward position (as it should) or does it return to its outward position (brake engaged)? There are two things to try if it does not latch inward: first, make sure the clutch lever returns ALL THE WAY to it's relaxed position when you release the clutch rope. If it does not go all the way back, it will prevent that latch mechanism on the brake from engaging. Some times, if the clutch handle does not return all the way, I have to "bounce it" a couple of times for it to seat all the way into the "clutch released" position. I'll pull the clutch rope in a bit and let go, letting it snap back until it seats properly. Lubricating the clutch arm mechanism thoroughly usually eliminates the need for the "bounce" maneuver (I just never have lube with me when I'm out in the woods). WD 40 works, but doesn't last long. It think I use silicone spray that dries on for a longer lasting lube. If I recall, I've also had to lubricate the 1/2" shaft and plate/latch from time to time - but I'd check on and work with the clutch return first.
The other problem you may have is if the nut on one end of the spring on that 1/2" shaft I mentioned earlier is not adjusted correctly. This nut is in area in side the circle on the diagram in the upper right of the picture you linked. The picture in the circle just below and to the right is a blow up of that area. You can see the nut (labeled "3") just to the right of the spring. If that is adjusted too tight, the cable will be hard to pull out. This is not something that needs to be adjusted frequently. If it's set correctly, you should not have to mess with it much. From your description, I would leave this adjustment alone until you have done the lubrication and verified the proper movement of the clutch lever.
Hope some of this helps. I hope your mechanism is similar enough to mine that some of what I described makes sense.
The folks at Hud-Son (the North American distributor for Uniforest) are generally very helpful. It was one of them who told me in a phone conversation about lubing the areas to make sure the clutch returns all the way and the brake latch engages.
