A few things Carl.
1)The friction washers should be attached to the pawl crossbar. They have been bonded to the crossbar on all the Homelite FM starters that I've tinkered with.
2)DO NOT bend the pawl teeth out if at all possible. They are brittle and brreak easily.
3)Don't put oil or anything else on the fiber washers.
4)The starter cup needs to be replaced if the 'grip section' is so badly hogged out that you need to bend the pawl teeth to reach. They get chewed up by ham-fisted people that just jerk the damn rope out.
5)There should be the pawl assembly (with two friction washers bonded onto it), two thin steel washers with a double "D" hole in the center that matches the axle shaft in the starter (one goes on each side of the pawl/friction washer assembly), the coil spring, a thick steel washer, and the 'E' clip that retains them. Without those two steel 'D' washers, the system won't work for ####. They're often missing...
6)The 'technique' used with a Fairbanks Morse type starter system is a bit different than 'normal' starters. With 'normal' starters, you slowly/gently pull until the dogs/pawls engage, then pull like hell. With the FM, you want to do a short, quick jerk of the wrist to seat the dogs..............then you pull like hell. Don't pull slowly to begin with (as the dogs don't extend well and get a good bite), and don't just do a hard jerk right from the beginning (as that batters the pawl teeth and the starter cup). You need to get a feel for it.
7)Many saws (besides Homelites) used FM starters with the same pawls, friction washers, and steel double "D" washers............so you have a broad base to search through when looking for parts. Even some old Stihls used these starters, so parts can be found at long-standing Stihl dealers.