Thank you all for your responses.
I took the wheel off today and shot the backside of it apart with WD-40. I also removed the plastic disc, which did have a large crack in it and was very brittle, so I suspect that may have had some play in the matter. Eitherway, it seems to have corrected the problem. I have the tool to remove the freewheel now, but it's on extremely tight and I haven't been able to get it off yet. It's a older bike and was passed onto me, so I'm slowly replacing parts on it as I save up for a new one.
Anyways, thanks all for your help on this one.
