The problem is the spur gear spinning on the shaft. No question. This is a very common problem and is just as easily repaired. The shaft and its hardware are sold as a service part and will set you back a whopping two bucks. Just make sure that you orient the washers and spacers properly. The most critical one is the washer between the spur and the gearbox bushing. Use RadioShack lube gel or Associated Stealth diff lube to grease it up.
It'll do rudder rolls without much problem if you have enough airspeed. Loops aren't possible from straight and level and don't expect large, graceful loops since it simply doesn't have the power, but if you goose it into a power dive and pull back, round and round she'll go. I stay on the power throughout the loop.
GO DISCOVERY!
