Trying to wrap my head around this one. You've done the alignment twice, so that's a clue that the PLL, VCO, etc, should be working or you couldn't get through the PLL portion of the alignment procedure. You also said no output power on 35-40, indicating that receive is working on those channels, which would also (mostly) exonerate the PLL, VCO, and mixer(s).
Yet this is a pretty simple radio, with not a hell of a lot to break. So, even though I've never worked on a 29LTD, here's my ideas.
Look at the inputs to the TX mixer on channel 40. Should be 10.240 and 17.165 coming in, 27.405 coming out. If that's not happening then you know it's in the PLL, VCO, or mixer and you can troubleshoot from there. If it's good, then follow the signal down the TX chain to see where it disappears. Then check the voltages for that component on CH1 vs CH40. If something is going to low (or high) you can chase it down.
To my untrained eye this looks like a TX inhibit signal is getting switched in that probably shouldn't be. Something like the PLL's out of lock signal. But, I've been wrong before.
Now, if I misinterpreted what you said and it there's no receive on 35-40 either, then that indicts the PLL, VCO, mixer area. I'd start at the PLL programming pins to make sure they're right and go from there.
Or just ignore me and listen to the smart people that are weighing in. They may have actually fixed a few of these in the past.