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Try putting a small drop of oil on the the metal shaft of the bobbin winder if it is not moving freely. The grinding noise implicates the winder tire may be ground from the locked winder shaft. The needle not disengaging requires oil in the shaft bushing. On this machine it appears you would have to remove the covers to access the appropriate areas.
Sounds like the embroidery arm belt stop is out of adjustment. Unless you're pretty handy, take the machine and arm to a professional. If you're going to tackle it yourself, get a service manual for the machine.
Check to notice if when the embroidery arm is installed and you turn the power on does the embroidery unit move as it calibrates the stepper motors. If not I would first check the plug where the machine and embroidery unit attach. If this looks ok and is not out of place it could be a cable, or the main circuit board. Both of those are for your dealer to repair.
Sound like the whole unit needs a good cleaning. My rule is "if it moves give it a lube", be careful not to get oil on electric boards or in the motor. What is the make and model of your machine. I will try to help you more.
While the embroidery arm makes a certain amount of noise when it is initially indexing, I'm assuming from your description that the mechanism is making noise but ends up stalled (probably with the hoop holder in the rearmost position). It sounds like it's not engaging the end stop switch correctly. Take it in for adjustment. This is not something you want to tackle yourself. Beyond the switch adjustment it may additionally require recalibration to properly register the various hoop sizes.