When I was setting mine up, I found the dogs were lined up perfectly for the recesses in the ident plate – but I could either set the linkage to get Neutral, second & Third – But not first OR First, Neutral, Second, BUT not Third.
The bush on the centre of the “velocette” change mechanism was a very snug fit, but the main lump (Rotor?) of the change mechanism was quite loose in the outer “drum”. When I looked closely, you loose a hell of a lot of travel with this play between the drum and “Rotor”. As a stop gap (a few years ago now – so maybe not such a stop gap), I compensate for the play, by experimenting with some butcher feeler gauges. I found that a length of 5thou feeler gauge Araldited to the top and bottom of the Rotor to remove the play between the two – and now it changes gear superbly.
One of these days I will make a more permanent repair – but as this is beginning to look permanent, may be not ……
Anyway – worth a look in case that is your issue.
Cheers
Graham