Great Job Crabdance!
That happened to me once with my 10-Speed. The chain lashed itsef into a crevice between the frame and the hub. It would not come loose until I forced the wheel backwards, gouging the chain free (but not until after I messed my hands with chain grease before work). Glad I had a scrubbrush in my locker.
Chain problems are one of the many issues that moped geeks like us need to handle. 150 miles to a gallon makes it worth the hassle, at least in my book.
I'm workin on my carb, too.
Good Luck With Yours!