Is the gear on the output shaft of the tranny meshing correctly with the drive gear? The clip holding on the driven gear can break or fall out. Is the driven gear (what you called the worm gear) moving when you spin the rear tires with the cable disconnected and the rear wheels off the ground? Here is a cutaway picture http://www.transmissioncenter.net/sp...n_______va.htm
68 RS Coupe 327/350 TH, Detroit Speed, Hotchkis, Vintage Air, 8.5" 3.42 posi 10-bolt, MagnaFlow 2 1/2" exhaust, etc.
"The public cannot be too curious concerning the characters of public men."
Mine just started messing up too. sometimes it would work and other times it would go to 20mph and stop when I was going 60mph. Then one day it was stuck at 20 when the car was stopped . I took mine out then the needle went back to 0mph. What I found out was when the speedo was out it seemed to work when I spun it,but when I spun it and held it with some pressure on the side it would stick and not go back to 0mph. Long story short,I sent it to Denver Co to have it fixed,and just got it back the other day. But have not reinstalled it yet. It cost 139.00 plus shipping and tax 156.oo should be good for a long time .. Also I was running a new cable when it went bad. But this car had sat for 26 yrs ,but was in great shape. They told me at the speedo shop that 9 times out of 10 its something with the barrel and magnet out of adj.