John Deere STX 38 lawn tractor brakes not working?

I had brakes on my John Deere STX 38 lawn tractor then they stopped working. I took the old brake pad off and noticed that there were two deep indentations where the push pins work against the brake pad when the lever is activated. I replaced the old brake pad with a new one from the John Deere dealer. I have adjusted the pad to have a slight drag on the brake rotor. When I hand push the brake pedal, the brake rotor shaft will not move and the trans axle will not move. These two shafts will move when the tension is released But when I run the tractor the brakes will not stop the tractor even at low idle at any speed range. I can hear the brake pad rubbing against the rotor and there seems to be a slight drag on the engine power. Is there a problem inside the trans axle?
Thank you in advance.
John

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