I was wrong about the capacitor, I tried it in another teletype and it worked just fine. In fact I tested three caps so now I have a spare for the future. I also tested the motor relay (which works), re-soldered the UCC-6 controller card resistor joints, and replaced the UCC-6 itself. I found nothing wrong and I was still at a loss to determine why the teletype was running open in LINE and LOCAL modes.
Then I found the source of the problem. The BREAK key pin was out of its joint under the keyboard, just slightly, but enough to be constantly "on". I must have caused this issue when I vacuumed the insides of the TTY after running a long punch job without a chad catch cover on the punch pins. Note - don't ever try this.. What a mess!
By re-aligning the pin into its slot, the TTY now closes in LOCAL mode or when engaged by a computer system sending a current loop.
1. I replaced the cover, paper advance knob, and re-aligned the papertape reader.
2. I tested the system using my SWTPC and PDP 11/05. For the first time I got a good print from the 11/05. (I will come back to that later).
3. Wayne D. sent me a papertape punch chad cover (triangular plastic thing) which I installed.
4. I read a long papertape (TSC BASIC) using the reader, successfully loaded BASIC, customized it, and punched the customized copy to tape.
5. I fashioned a new cable for the computer.
Took a few new pictures.