Try priming the pump. I've had trouble with mine a few times and actually had to close my exit valve and shout some water out of the pump onto the ground through the exit hose. After a few seconds the power may increase. If this happens close the intake valve and reset the hoses to original positions. Typically it will start up at normal stength.

Ure the propeller and shaft turn, but I woulsd dare to say that they are actually turning independant of each other. Sort of like a stripped nut on a bolt. They both look like they are in place and working, but when you add any sort of pressure they just don work the way that they are supposed to. I bet the shaft is actually spinning inside of the propeller, as soon as the water pressure is built up, it fails. Spinning it with your fingers will not imitate the real life pressures exerted on the propeller and shaft, that the water pressure exerts under load (in operation). I would either rebuild it with new parts (new shaft and Propeller) or just go out and buy a new one with a warranty. There is no other reason why this pump will jnot throw water through your system... NO REASON, unless you have the thing hooked up wrong, but I think that would be impossible, wouldn't it?