Transmission Trouble

[dtharmon]

We put my Cal27 in the water this weekend after being on the hard for 9 months. I am happy to report that the motor turned over on the first crank and ran cool for the short trip from the travel lift to the slip.
My trouble is the transmission. When I put it in forward to move away from the pier we had no movement. The gear lever was not all the way forward. I had to force it down and hold it in place to get the gear to engage. If I let go of the lever it would disengage. I didn't want to damage the transmission, but our slip was the closest refuge anyway, so I kept it in gear long enough to gain momentum and then drifted. There was a good squeal when in gear. I alternated forward & drifting until we were safely tied up. When I checked the engine compartment there was noticeable amount of smoke.
I have the Moyer Marine Overhaul Manual, but I left it on the boat, and this issue seems to be all I can think about. I have had the boat/motor for 8 years, and have battled (successfully) the overheating issues, but I have never had a issue with the transmission. What should I check first?? Where do I start?