With the transmission in gear, all the gears should turn, but whichever one is engaged will turn the same speed as the shaft it is on,and the others will turn either slower or faster than the shaft, depending on which gear you are in.

Try this: If you slowly shift the range (middle rail) you can usually get it to sit between ranges, having neither engaged. Then try rocking the tractor with it in other gears, one at a time, and see if that lets it move easy. That would tell me that one of the two ranges are seized, down on the bottom shaft, front compartment. If not, then it has to one of the gears on the pinion shaft cluster. All the rest are splined to their shafts.

I'll add the cluster diagrams from the Oliver service manual, which show the power path in each gear. You'll see in them that the ground down thing definitely used to be a gear.