Will the prop shaft turn over by hand? (gearbox in neutral of course). You may want to check the prop has nothing wraped around it. The first thing you have to determin is if the
engine issue is related to the box, or a seperate problem. Will it rev OK in nuetral and not smoke? Check air intake for block or wet air filter.
As for poping out of
gear, you may have internal
gearbox problems. However, ensure the gear selector (at the box end) is going all the way home when gear is selected. It may need adjusting.
Also check the
oil in the box for level and for
water contamination. Unfortunately, if either bad side of that has occured, then it may mean a
rebuild on the box.