Spring (1) should be connected on one side with position (2) and the other end at position (4).
Position (4) determines the tension and thereby your shutterspeed accuracy.
You can start in the middle position, but you need a shutterspeed tester for the right position.
I don't like position (3): it should be straight, but bending it back can de tricky as it can break off.......
Peter,
Thanks for the info on the escapement spring. I have followed your instructions the spring is attached as you described. I placed the end into the second slot. It stays & the escapement seems to function when put back togaher. Has not improved or seemed to have affected the other issues in any way. Will get with you shortly offline with more data. Once I have futher along I will post results here. Thanks!