Before I went for a ride today, I tried to move the collar up on the rear shock. I didn't have the tool to do it, so I tried the trailside method of screwdriver and a hammer, but stopped as I could see the potential damage I was about to cause.
As I got on the bike I noticed the shock was much softer than before. Soft enough for me to flat foot the bike and push the tail down with my hand, cool I thought, but I didn't change anything except applying some penetrant to the collar.
Went for a ride on some gravel roads, the shock was awesome! I could sit while hitting some bumps that would normally send a shock up my spine.
Continued riding for a few more hours.
After a quick break, I got back on the bike and noticed my sag wasn't there anymore. Bounced up and down, now it was only sagging a very little bit and it felt like it was oversprung (like it normally does for my 140lbs).
So what happened? To make it work correctly for the first time, then stop?
It was as if the shock was bound up, then wasn't, and then was again, best I can explain it.

 

I bet the penetrant oil you applyed freed up a siezed lower shock bush and as the day went on it dryed out and locked up again.
you need to service the lower suspension link bushs, disassemble clean and lub.

 

I agree it's time for some maintenance but...I only sprayed the collar on the shock body, not any pivot points, and I wiped up the excess.
Maybe it was the hammer taps that freed it up?
I will take it apart and see what is what.
Thanks.

 

OK, so I decided to set the rear suspension back to factory settings.
My problem appears to be a locked up rebound screw on the bottom of the shock. It isn't totally locked up, it has about 4 clicks worth of adjustment, not 20!
So can that screw be taken out without screwing anything up? It seems it needs a thorough cleaning, feels crunchy in there. My manual only shows the shock as one part, no internal views, so not sure what is underneath.
I also noticed that there is no air valve under the gas reservoir. Is there a cap that can be removed, like on the A/F screw?

 

The oil in the shock is under pressure, if you remove the rebound adjuster it will spew out oil. The gas bladder is discharged/charges by inserting a hypodermic type needle through the cap on the reservoir on the shock. Racetec has a tool http://racetech.com/images/TSNN-01-WEB.jpg that allows you to do this or you can fab up something similar.