Anyone here use a Bearcat chipper/shredder? Answer to a problem please
 

Hello.
I recently acquired a Bearcat model 70380 chipper shredder from my late
father-in-law. Powered by a Honda 8hp 4 stroke petrol engine with the
accessory belt-driven blower and discharge chute. Less than 1 hour use from
new, although it is probably 8 years old. Supposed to chip up to 4"
material.
Serviced the engine and got it running.
It shreds very well indeed but the chipper refuses to chip.
Have checked the chipper blades and also clearance between blades and
cutting surface.
Blades are V sharp and cutting clearance is within tolerance.
Anything less than 1" slowly chips into very small bits. Anything more than
1" will not chip. If applied with force it just produces smoke and smells
of burning wood.
I've stripped the chipping/shredding dept. and all seems ok. All blades are
as new, the bearings are good and the shaft is true. Chipper blades are
fitted correctly according the the manual.
I'm stumped!
Any helpful advice please?
Thanks
Phil