The reason it grinds is the clutch plates are no longer releasing when the shuttle is in neutral. This is because when there is no hydraulic pressure on the shuttle for either forward or reverse gears, the springs in the clutch hub would normally release the clutch packs. The pictures I already posted show what happens to the release springs as these machines get old. No guessing as this has already been covered on tnis forum by a number of other posts. I benefitted form these and ended up rebuilding my shuttle. My shuttle worked fine except that even with the clutch pedal depressed fully, and the shuttle pressure gauge showing pressure to the clutches 'dumped', they were not completely releasing.
In the mean time, you can connect the two wires that go to the neutral switch located in the transmission top cover near the shifter. This will defeat the safety switch and allow the tractor to start in gear with the shuttle in neutral. Mine was like that when I got it and I used it that way for another 20+ yrs before the rebuild.
If it will shift at low idle, then you have a bit of time before a rebuild is necessary, but nothing will make it any better except a proper repair. I suggest that if you haven't already got a service manual, that you get one before you go to far with anything. In the manual, there is a section on how the Power Shuttle works and diagrams to help you understand what happens when its in neutral, forward and reverse. The rest of the manual is invaluable in understanding the what and how of these relatively simple machines. Have fun.