Escort GT Transmission Problems

I recently bought a 1992 Ford Escort GT with a 5spd transmission. The woman I got it from told me all that was wrong with it was that her husband put it in park while it was still rolling and the transmission quit working.... well I dont understand how that's possible since the car has a manual transmission and not an automatic... there is no PARK! Anyway... I can press the clutch and start the car but no matter which gear I put it in... no movement, just a sound like something rubbing in the transmission (kinda like the sound of rubbing two peices of paper together), a smell of hot brakes, and the speedometer moves. This only happens when I let off the clutch pedal. There is no sound when the pedal is presssed. I've been told that the clutch is completely gone out and I need a new clutch kit. My dad doesnt think this is the problem... he just thinks the transmission is shot. If anyone has any ideas as to what the problem is... please let me know.
Thanks

The hot brakes smell could be the clutch disc slipping against the pressure plate. Prognosis---new clutch. The speedometer gear operates off the final drive differential gearing. If the speedometer is moving when the car is in gear with the clutch out, there would be some cause to suspect the differential is turning, but the half-shafts are not. Side gears that turn the half shafts could be stripped out. Prognosis---new tranny.
I'd put in a boneyard tranny with a new clutch kit. Rebuilt trannys are running about $1200. You probably paid less than that for the car. I think you would be looking at about $400 for a used transmission. The older GTs were fast movers. I hope you get her going.

Thanks for the info. I actually asked a mechanic today about what the car is doing. He said it could just be the input shaft -- i have no clue what that is but he's going to look at it free of charge so that's worth a shot. Anyway you were right... I only got the car for interior parts for my '93 until I found out the engine run so good. I only paid $75.00 for the whole car. The rest of the car is in good shape except for a broken left front signal light cover. I have one of those left from my '93 when I changed them out for clear lenses. The car has all the power options including the optional power sunroof. Even if I have to put a new transmission in it... I believe it'll be worth it.