Correct on both counts. This looks like an old Spicer PTO and it is made for a lever shift i.e., NOT a cable shift. If it isn't free turning then it is in gear and engaged. You can remove it if not needed and put the 6 bolt steel cover and gasket back in it's place. You can get one anyplace that installs or sells PTO's. I see your in western NE so call Kois Brothers or Frontier Truck, both in Denver.
