Sicivicdude-
you are da man! removed drain plug and drained out old gear oil(it was nasty & needed it done anyway) and retested shifting operation-shifts normal now in all gears!!! I mic'd the drain plug, it has an overall length of 28.72mm. Not sure what the stock length is but i'm gonna get one!! Do you guys recommend using Motul synthetic 10w40 gear oil ? i know the o/m says something like 10w30 regular oil. Again, thanks man!! \m/
I would say, remove one thread and reinstall. If it feels like it hits anything at all before the drain plug is tight against the gasket, pull the plug and shave another thread off.
You can have probably a minimum functional length of 15mm (not including gasket thickness).
You need type SE or below motor oil so that it doesn't have friction modifiers. Sulfur and phosphorous compounds will "burn" into the clutch fibers and gum it up causing hard shifting, dragging clutch, or even slipping clutch.
Good luck finding Type SE or below motor oil in any auto parts store. If you can, the bottles will be old and faded... You can buy either synthetic 10w-30/10w-40 ($$$$) or regular 10w-30/10w-40 "motorcycle" oil at almost any auto parts store. AutoZone and Advance Auto both carry Valvoline brand motorcycle oil that is compatible with wet clutches.
HOWEVER, that's not what I use in my transmission. I differ from the service manual (not something I do often or recommend often either) in that I run ATF in my transmission. The premix oil (or injection system oil) lubricates the engine itself (crankcase). The transmission fluid is exactly that.... transmission fluid.
Yamaha calls for 10W-30 SE or below but I actually run standard Dextron III/Mercon transmission fluid (some people say ATF Type F but I've run both and see NO difference). The advantage is clear... or red. When you are checking the level in the sightglass and there is mud and dirt all over, oil is hard to see the actual level. Transmission fluid is red when it's clean so the level is easy to see. Also, as the clutch wears it puts fibrous material into the transmission fluid. This generally isn't any risk to the transmission as it will chew it up and not harm anything but you don't want to run it too contaminated or it won't lubricate the clutch pack as well. When the ATF is contaminated it turns from bright red to dark brown and is MUCH easier to spot than motor oil.
BTW, If you search Wikipedia for "yamaha blaster shifting problems", that ^^^^^ is the first reply 8-| 8-| 8-| <----JOKE!!!!