Bicycle Mechanics - Newbie: Question about front derailleur

I am brand new to biking. I purchased a used 1987 Trek 1500 as a beginner bike just to make sure I like biking. The bike has a mix of Shimano 600 and Shimano Sante components. It is a 7 speed drivetrain. I am having trouble with the front derailleur and wonder if it is bad and can be replaced with a new/different derailleur. First, the derailleur does not seem to be very responsive, especially when shifting from the small chain ring to the large. It takes several revolutions to shift properly. Second, the chain is often thrown to the outside of the large chain ring when shifting. Third, when on the small chain ring and the large cog, the chain rubs the inside of the derailleur.

I have tried adjusting the H limit to fix the chain throwing problem, but even with screw all the way in the chain is still thrown if I am not super careful. I have also tried adjusting the L limit to fix the chain rubbing issue, but even with the l screw all the way out it still rubs. Unfortunately, I am not fit enough to not need the small chain ring and large cog. Thus, I would like to get it fixed.

What options do I have? Can I buy a new derailleur? I don't want to put a ton of money into the bike as I would prefer to just buy a new bike. At the same time, I want to get the derailleur working properly so that I can ride it until I can afford a new bike and also, so that I can sell the bike as a working machine.

Thanks.

The least likely culprit of a disfunctioning derailleur is the derailleur itself.

Detach the cable and re-setup the front derailleur: http://www.parktool.com/repair/readhowto.asp?id=75

While the cable is detached, feel how smoothly or roughly it moves in the housing (if the bike has down tube shifters, there may not be any housing for the front) and under the bottom bracket.

It may be the FD after all, try putting some light oil on the springs.

Thanks for the reply JiveTurkey. I have actually already tried both of your suggestions. The Parktool website has been great, but the problems still persist.

Any other suggestions?

You replaced the cable and housing? If you've done that, adjusted the derrailleur properly and it still won't move close enough to the frame and moves too far away, even after adjusting the stops, it could be that this is a bottom bracket or crankset issue. Maybe the bb spindle is too long for the frame. How does the chainline look?

Adjusting the front derrailleur can often be part limit screws and part placement on the frame if it wasn't placed properly in the first case. Not only must it be placed at the right height but it often needs a slight tweak to the angle to get the cage in the right orientation. Starting with the outer face parallel to the chainrings is a good start.

If it's throwing the chain off the outside and not travelling far enough to the inside then it may be that you're not adjusting the limit screws correctly. Something to play with and figure out exactly which screw controls which limit. Some playing with the cable using the barrel adjuster at the shifter as well as playing with where it clamps can help a lot as well.