As you both say... I would also expect there to be 2 arms and I suspect that this is where the problem is but there is no indication that anything has broken off.
I bought the engine off ebay in a supposedly "ready to use" condition. Needles to say that when I stripped it I found the big and little ends were scrap as were the bearings. In addition, this sector fork was disengaged but there was no sign of any broken off parts.