Disconnecting the amps and capacitor made no difference.

Truck battery next, see if that works.

fix the starter.

Have the battery load tested..

There are two circuits involved here. One is a "low current" that goes through the ignition switch. The other is a high current that passes through the starter relay/solenoid. Have a helper test the voltage at the terminal from the ignition switch while you try to start. The most likely culprit is a low battery, followed by the switch or the bulkead connector. If that voltage is fine, have your helper test the battery voltage while you are cranking. If the battery voltage is fine, check the voltage on the terminals also while cranking. If good test the starter terminal while cranking. If the voltage is good at the starter terminal replace the starter or the starter solenoid. Also ensure that your ground from engine to battery is good and that you have the engine grounded properly to the body.

Jumping the terminals sounds exciting I guess with the 12v going to the large terminal on the starter being constant and the smaller terminal being just in front, it would be easy to bridge the two with a screwdriver. This I guess bypasses the starter relay?

If you read up a bit, I did test the starter (both terminals) during ignition and the main 12v feed dropped slightly and the smaller one that has nothing going to it to start with got around 11.5v when the key is turned. This to me suggests the electrics are working ok, I've checked the grounds, I even installed a second battery to body ground and I might add another engine to body ground as well (can't have too many grounds...hehe).

I think the starter is at fault here, the fact that it jumps out but doesn't engage the flywheel wheel means its kinda working but just not energizing properly? The annoying thing is, I've had the car for over 3 years and its always cranked over, up until the back end of last year anyway. I had this problem once before where it just clicked but the next time I tried, it turned over. This time however, nothing and I've been trying and trying hoping it would just go. I plan to remove the starter this week, I will bench test then to see what happens.

If the bendix is jumping out and the starter is not turning the contacts in the solenoid are not working.....time for a starter or new contacts....

If you have narrowed it down to the starter do yourself a favor and hit the starter a few times with a BFH. I've had them turn over and work for months after that. If it doesn't work oh well your going to swap it out anyway.

What is the voltage between the big terminal on the starter and battery negative post while cranking?
Then check voltage from the big terminal to the engine block while cranking and let us know what the voltage is.

Missed that last comment and went and removed it from the car after a lot of swearing trying to get it round the exhaust header.

Anyway, bench test revealed it still doesn't work!!

It just clicks as it did on the car, kinda jumps out a bit but goes right back in, no spinning like it should.

The annoying thing is, the starter looks new, I stripped the solenoid to check the brushes and they look fine, all the inside looks OK. Is there anything in particular I should check on the inside of the starter or solenoid?

As previously mentioned the car was part restored when I got it, which probably explains the almost new looking starter but if this was an aftermarket replacement perhaps its not up to the standard of the original?

I tested by fixing the negative terminal on the battery to the body of the starter via a battery cable and then the positive from the battery going to both small and large terminals, all I get it click click and a few small arc sparks from the battery as I touch it on.

Clueless

Since you now know what the deal is I'd upgrade to the smaller starter and toss that one in the box for a core...
Should make reassembly a little easier...

Open it up further. The solenoid ain't moving far enough for the large terminal to get continuity to the armature for the whole shebang to engage. Go further/you'll see what's fubared. EDIT If you're in a rush, what Skicker said, toss another one (reg or mini) in there & be up & running. plenty of parts over there?

I'm not in a rush so much, I just don't like my engine sitting there without a start up once in a while. The car will be off the road for a more months yet while I finish up a few other jobs.

Parts aren't readily available sadly and usually have to be ordered from the US, which means waiting and waiting... I've been told by the shop over here I get my parts from that a new starter is $170 NZ, which I guess is about $130USD or so.

Out of interest I did completely take the solenoid apart and couldn't spot anything obvious? The large coil came out and looked OK, bearings etc all fine, the 4 plates on the outside of the body had a small amount of dust but were ok after a wipe clean.

I mean there isn't a lot to go wrong right, its just magnets?

OK I've just had the entire thing apart and put back together. I tried a direct feed to the motor via the electrical mount that comes out of the solenoid, doing this results in the motor spinning up as it should but not jumping out because of the lack of solenoid.

As soon as I try through the main input that goes through the solenoid, I am back to clicking and no spinning...

All the parts in the solenoid look OK. There is a large copper washer that contacts between the two electrical feeds, so is the ignition feed (small connection) at fault?

Sorry guys, just wanting to make sure I've covered everything before committing to buying a new one.

haha, another twist in the tail

Turns out mine is already the mini hi torque type of starter, as seen here at my local supplier

http://www.musclecarparts.co.nz/high-torque-mini-starter-440-source

quick movie showing what happens

Push solenoid down manually, motor spins up no probs. Join contacts of two terminals and the solenoid activates and pulls down the center tube, which connects the copper washer but the motor doesn't spin up?

Confused???

https://www.youtube.com/watch?v=1R0hkdkCa4k

Cant see movie it's private it says

Your symptoms indicate no contact across the round copper washer and 2 contacts on either side.....Are the surfaces clean?

Have changed the settings now on the movie

The copper contacts are all clean, the internals are very clean and new looking. If I press the washer down the motor spins up no probs, when the solenoid pulls it down, nothing happens??