the rod has threads and its in two parts one on the top and one on the lower unit side, the long nut is threaded so it unscrews from one as it screws farther onto the other with a lock nut on each end (at least on mine).
maybe they did away with the lock nuts and just use washers now since it just needs something to keep it from turning by itself.
yes its a tight spot and there is very little room to work but thats how you have to release the shift rod. i dont know what your looking at but the washers must be released and the nut unscrewed. if i recall its 10mm wrench you need
seen here described as the clutch rod but its the shift rod:
http://www.boats.net/parts/search/Su...TCH/parts.html
lower unit and shift rod removal info can be seen here if you go down to page 253
Manual Serviço DF40-50
its a big service manual so it takes a minute to load