Update: I jacked up the rear (blocked the front) and rotated the wheels in 1st so the 39-tooth gear would rotate. I used a mechanics mirror to look at the teeth at both sides. All clear except for the previously mentioned chips. I used a dental pick to scrape at each tooth "valley" and felt it catch on a few occasions. Perhaps some debris...not sure. But with a few flicks I couldn't get the pick to catch anymore. Flushed the fluid and put in new fluid. I put the shift cover back on, dropped her down, fired her up and took a spin around the yard. The vibration appears to be less than it was. Or maybe it's just wishful thinking.
But I think everyone is right that I probably won't do any damage with old Betty as she is. If it gets really bad I'll park it and do a tear down.
On another note, I adjusted the clutch fingers by tightening the set screw in the center of each bolt 1/2 turn clockwise hoping I could reduce the flywheel speed faster as I'm pretty sure the pucks weren't making contact at all before. No difference. But I can say that the clutch pedal was all messed up so I had to realign it after doing the adjustments. I'll do 1/4 turns this weekend to see if it makes any difference. I've only had the tractor for two weeks but I know the grinding-into-gear noise well so I always let the flywheel stop before moving into gear. Might have to replace the pucks but I'm probably going to wait for Cecil's to have the pros give me their thoughts.
I feel progress was made and I couldn't have gotten this far without you guys. So, thank you.
PS-New tires on the back! Nice and smooooooth ride now!