Interesting that it shows PTO is on but doesn't turn the output. Does it show a RPM for the PTO on the display when this happens? Are you sure the issue is that the PTO isn't turning the shaft, and not a problem with the snowblower itself?
I provided a copy of the PTO section of the service manual, but it doesn't have a diagnosis for this problem. If you can't get any help from your Polaris dealer, you might see what your local Bobcat dealer would charge to take a look at it -- at least they are accustomed to dealing with powered accessories, just tell them it's a Bobcat 3650 with a custom paint job
well the dealer returned my machine last week, said it was the seat sensor, so they changed it, today we have snow and the pto worked for a while and now it will not engage, they did not fix the problem, back to the dealer on Monday.