Walkman azimuth adjustment - Mechanical problem

[steve30]

As mentioned in another topic, I've been doing some work on a very pesky Sony Walkman WM-10 for someone. It all works fine now expect for the azimuth adjustment which is giving me trouble.

A few times, the adjustment was causing the head to not retract when one pressed the stop button. A bit of adjustment with the adjust screw fixed that, then the screw would turn, but not actually adjust anything. After a bit of poking around, the screw turned, but eventually got stuck, and now doesn't turn at all. Its so stuck that some of the screw-head got stripped.

Can anyone figure out how this works/why it might have gone bad/how to fix it? I've attached an annotated photo and a demonstration video. It is a bit of an unusual adjusting mechanism compared to your usual Walkman/tape deck.

Thanks
steve30