Hello partner, nice to see another rotax 127 owner. Personally i didnt rebuild whole rotax engine, currently rebuilding top end with some problems. I currently saw older thread with rotax 127 if this helps you, Help With Aprilia Tuareg also I am currently searching for diagrams for transmission but i cant find almost anathing for 127, mostly resulsts show Rotax 123 engine which is similar but has few differences.
Does bearings move freely? Maybe it could be bad allignment of cases, I'm not sure if Rotax 127 have dovel pins for allignment or maybe there is friction between shafts and bearings. It's recomended to grease up metal to metal contact areas trough assembly process.