I've had the same problem, both with the operation and the lack of a diagram. It's been a few year now, but I just started taking it apart until I could get at the gears, being careful not to do anything with the "cables". What I discovered is that the grease Lionel used had solidified … and they used a lot of it. I had to literally pick and dig the grease out of the gears. I didn't have enough grease to properly re-grease it and that's probably why the counterclockwise rotation makes a grinding noise. I intend to disassemble it again at some point, maybe over the holidays.
I hope this helps a bit. Sorry that I don't have any pictures or a better memory.
