Tranny issues with those motors are typical, usually comes from banging 1 to 2 gear shifts repeatedly. Id check the detent spring first, then shift forks and last the gear dogs themselves, if there are big chncks of metal on your oil plug or in the pan its a good bet the tranny is toast. Could be in a false neutral... make sure the thing is actually shifting into 1st or 2nd gear position. No neutral light should be showing. Could need a new clutch but it would slip through all gears not just 1 and 2. Now worse case you'd have to pull the motor, split the cases and swap out the tranny itself. Not something a novice should try Id say. But if you're brave go for it. If it's hosed and you want to sell the rolling chasis let me know, I may be interested. PM me...