I went through a similar issue on my 500.  My key wasn't sheared though, whoever put the tranny together before I purchased it had the timing of the counterbalancer wrong.  Derrick let me use a tool he made.  It's a metal shaft with two bolts welded onto it that fit into the holes on the flywheel.  It worked like a charm to hold the crank.

I also tried the penny trick along with having my dad holding onto the gear itself with massive channel works and that still didn't work.