Ron, it looks to me like you'll need to drill that pin out. It's possible that someone installed a pin that's too long and it's bottoming on the shaft, which per the illustration looks like a blind hole. The instructions say that you need to install a new pin in any case. If you can keep the hole centered in the pin, you can drill until its just a thin shell and drive the shaft out while collapsing the shell remnants of the pin.
Good luck
Caveat: I have no direct experience with the SM420, but reviewed the overhaul instructions that you helped resurrect up in the tech tip section.
