I'm currently going through two of these reels that were retired many years ago and everything went smoothly until I removed and cleaned the drag washers on one. Everything went back together as was taken apart and the retaining ring went it properly, but the drag knob seems to be slightly raised allowing the string to get wound between the knob and spool. I tightened the knob down as far as I dare to see if the felt washers would compress a little...but no effect. Any one run into this? When compared to the one that I didn't fool with, there is about a 1/16" gap between top washer plate and retaining ring. No gap in the one I cleaned. I took it apart again and made sure no debris was in there.
I believe I figured out the issue. The metal washers have become cup shaped over the years and flipping them cup edge up allowed the drag knob to sit down lower. I'll give it a try this evening and see if it happens again.
I was digging around in my shop and found the plastic container with all the old Penn reels and down in the bottom was the last missing metal decal that goes on the side of one of the reels. Now I can make them fully complete.
Hope you figured your problem out, have been playing with a 2499 and a 2200 025 here my self lately!