This is the cog locking the gear in place and is key to your solution. Unless you have a method of releasing this cog, there is no way any handle will release the mechanism directly. Regardless of what you do with the nut, or a C-clip, that will not solve the issue.I could turn clockwise and heard a click.
Taking a wild guess, I'm betting you have to turn it slightly clockwise to get the cog to release. If there is a lot of tension against the cog, it will not release - kind of like taking your car out of park when it is sitting on a steep hill. I'd be inclined to wiggle it back and forth and see if it will release. If it is supposed to be automatic, and there is some sort of clutch mechanism involved with the cog. My guess is the clutch is having difficulty overcoming the cable tension, which is holding the cog in place. The clutches likely grab the cog and flip it out of the way. This is why I suggest turning the crank back and forth, both to take tension off the cog, as well as get the cog to move out of the way. There is probably some rust preventing the cog from moving freely. Wiggling it may break the rust free.