Originally Posted by
FBinNY
If the old chain was badly worn, the freewheel is likewise toast. Search the forum for "new chain slips on old cassette" and you'll see this situation is classic. A new freewheel is the only solution.
As for the slack lower loop, some sag is normal, but if it sags more than 1/2" below the straight line level, that's too much. However it's probably not the spring, but that the Chain is long and the RD cage is hitting the stop. If it were the spring the chain would sag in all the gears to verying degrees.
The old chain actually seemed to be in fine condition. This thing was litterally never ridden... The gentlemen who gave it to me was the original owner and this bike was 100% original including tires and brakes... I had just broken the old chain when I removed it as I didnt have the proper tools for that type of chain.