Clutch will not engage!

hey , i just got a 1979 xt500 in awesome shape , rebuilt motor and everything. i got it last monday , and went out for a ride on thursday to discover that the clutch was extremely jumpy and needed some fine tuning to be functioning properly, so i played with the freeplay on the handlebar lever and what i found was the cable adjustment was totally maxed out on the cable itself , and was juuuuust grabbing for things to work . i tried repeatedly to set the clutch swing arm with the adjustment screw on the crankcase to see if i could get the slack out of the old cable. nothing . so i went to my local parts desk and grabbed a replacement cable for $30 . came home and installed the new cable to find that the old one was dammaged and missing parts  and with the new one i was definetely able to now get the slack out of the cable however , it seems like wherever i set the clutch swing arm adjustment to , i cant get the clutch to engauge . as soon as i switch into gear with the lever pulled in , the bike does not roll . the clutch is not engaging . i followed the diagrams shown in the online manual i was able to find and set the swing arm adjustment to line up with the 2 marks as shown in the attatchments however STILL the clutch does not engage . the clutch WAS working when i went for a ride , i just wanted to fine tune the cable to my preference like i have done on many other japanese bikes i have previously owned . which makes me really think the cllutch plates inside are not stuck . they couldnt be if the bike was working days before right?? , atleast i dont think so , or at this point have any idea why this is happening , open to alll suggestions! would seriously appreciate some help!! thanks -jake