The cap screws coming loose on the end of the axle was enough of a problem that the design was changed to eliminate them. Replacement axles used a snap ring to hold the gear in place.
LockTite will hold fine even submerged in oil but it is important to remove all the oil before applying it. It sets up in the absence of air and once set the oil will have no affect on it.
I would use new cap screws when I put it back together. It is possible that the reason the old ones came loose is because they have been stretched. New ones are just cheap insurance against a repeat.
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Today's Featured Article - Women and Tractors - More Views From the Farmer's Wife - by Teri Burkholder. The top ten reasons why the judges wouldn't let you participate in the stock antique tractor pull: Hey, this is stock! It came with that V8 in it! That "R" on my tires stands for "really old" not radial! Blue gas? We thought it was a pretty color! What wire hooked to my throttle?
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