Silly me - you can see the space bar mechanism much better from the back. Here are photos showing whats wrong. Basically the silver levers that locate into the teeth of the ribbon advance wheel should move when I press the space bar but do not because the thing the space bar rod pushes is jammed some how.  

https://drive.google.com/open?id=0BwmrHl56AGVZX3ZNQlktWFdvUjg


 

Fascinating.  Your photos are like a course in typewriter mechanism.

***conjecture alert conjecture alert conjecture alert***

Now that you've done the hard work I recognize the silver bits though I've never seen them before on an Underwood 5.  When I've seen them the gear has shrunk and moved to just underneath the ribbon spools and been duplicated under each spool, though there may only be one set here if the crank rod moves back and forth to selectively engage other gears to reverse the ribbon. If I recall correctly one of the silver arms pushes the gear forward and the other holds what its got. (I was wrong about carriage movement, ultimately the mainspring, driving ribbon movement.  I forgot about the other power source available -- the "finger".

Seems like you are well on the way to fixing the ribbon advance problem, once you figure out why the rod mounting the silver bits is jammed or not rotated by the space bar (and presumably the letter keys).  Might it be too much to hope that when this bar is rotating again and doing its thing that some other attached linkage will make its way to the escapement and advance the carriage? But what is the role of that large double rod part?  I can't wait for the next episode. 

(Can't find that pesky Underwood just now -- seems I have been a little too clever in hiding typewriters out of sight.  )
 

indigo.girl wrote:

BTW: I'm calling this a No3 but I'm not 100% sure. I'm comparing to others I've seen on line. Is it a 3?

Yes, it appears to be a very late No. 3, from 1931. In addition to the serial number, the ribbon selector switch (bichrome ribbon shift) style, is the style that would carry over into the 6, and was found on the 3's in the last couple years of production.

Okay, gotta look at the bottom of my 1917 Underwood typewriter, and the part you've got out was the one that locks the type bar linkages when the carriage gets to the right hand margin stop.  It won't really affect the performance of the typewriter--just be careful about where the carriage is in relation to the right margin.  As for the space bar linkage, I'm guessing that yours isn't adjusted up far enough.  What that thing at the bottom is is a pusher for the mechanism up top, and there is no screwed-on linkage in between--it pushes the rack frame/escapement wheel mechanism up top of it, and it needs to contact this mechanism at its bottom.  Just unscrew the bolt and push it up until it contacts the rack frame/escapement mechanism. 

Now, back to your margin keylock.  If you want to re-install it, be sure you look at the way it goes in.  the way it secures at the bottom is this:  first, you put the fat end with the nut on it on the right side and push it in as far as it will go.  Then you take the skinny end on the left hand side and push it in its little hole.  Take the nut and tighten it up to where the fat end hole is, and it will secure it there.  Make sure you don't snug it up to that surface too tight, and that the bolt in the middle has room to swivel forward and backward.  I hope this helps--let me know how you come out.

A little progress. I followed your advice Repartee and sprayed with WD40 and gave it some jiggling. I have been able to get some movement and in fact can now manually get the fingers to walk along the ribbon wheel and for the Y-shaped thing to move up and down (sorry for the lack of names but its where the type heads go to when keys are pressed!). I have taken a video and you can see what I mean. I have disconnected the space bar and am mimicking the movement using a screw driver. Now when I press any key it all moves but it will not reset so the next key does nothing. Its as if I am missing some kind of spring to pull it back each time. Any ideas what part should pull the mechanism back each time in between key strokes.

https://youtu.be/1NvXTjo3l_0

Btw I love the way the fingers walk across the ribbon wheel - ingenious!