I'm not a VW Tech, but I've got a few friends. You say it locks into place, but yet you think the linkage isn't fully engaging? If the linkage wasn't going into the proper place you should easily be able to figure that out, it would be visually obvious as well as you'd feel it. It sounds to me like there is no 5th gear cog in the transmission. If you said it wouldn't go into 5th at all I'd think it was an old 4-speed, as unlikely as that would have been. Whoever rebuilt the trans may not have put the lock rings and such in properly.