Hi, I agree with 01blaster_freak. Being able to push it forward slightly is normal. The gears have to line up on the input and output shafts and the dogs have to engage against each other. There is also some very slight slack to be picked up in the chain on take-off, but this is generally not noticeable when taking off from a dead stop. Also, a loss in performance could be attributed to other causes like a dirty air filter, old gas, carbon buildup in the exhaust port or expansion chamber, air leak around the cylinder, or varnish/sediment in the carburetor that is partially blocking a jet.
I would start out with a compression test to determine the static compression. A compression test has been best described as checking the blood pressure of an engine. It gives you a quick estimate of the wear on the engine internals. I’m not sure what a stock Blaster is rated at, but I have heard that anything below 100 psi is on the low side. I do know that when I was building and testing a Blaster, I once took a reading at 95 psi, and the engine ran smoothly. Of course, that was before my own modifications. Ahem.
As far as rebuilding a two-stroke engine, a service manual will provide very good directions for a do-it-yourselfer on a first-time rebuild. The Haynes line of manuals is pretty good, and they have a lot of pictures. Clymer is okay, but I have sometimes found that they don’t have the diagrams or specifics that Haynes has. But I have also found the Yamaha Factory service manual on the Internet and I downloaded it. Unfortunately that was too long ago, and I don’t remember where I got it. But it does exist somewhere. If you’re desperate, I could email it to you. But I have found that manual to be lacking on explanations, and it may not be very good for a first-time rebuild. It was intended for the experienced Yamaha technician who really only needed tolerances and torque specifications for a quick tear down and slap back together.
I do encourage you to do the work yourself. It’s much more rewarding than sending it off to some shop or having a dealer do the work. You learn a lot more and you find that, with experience, you do a better job than the shop anyway, especially when you have a few engines under your belt and the confidence that comes with that. Plus you save yourself the $65 an hour of the shop doing the work, on top of the cost of parts.
If the compression test is giving a low reading, and it has been awhile since a new piston & rings, it may be time to rebuild. I know that on high output two-stroke quad engines, after 30-40 hours, it is time for a new piston. You can leave the engine in the frame for a top-end rebuild, but you will have to remove the expansion chamber, carburetor, and any other cables that are in your way. Other than that, just follow the directions in the manual, and post any questions you have on the forum.