Baring any pulleys or spindles locked up, I wouldn't think it would be a PTO. Seeing that its electrical it would short out, not really having anything to do with the fuel, governor or the engine.
If you run the unit at top no load speed, does it run fine?
Running at top no load speed when you flip the PTO switch on this is when the problem starts?
If so its a fuel problem 99% of the time. As your now running against the Governor at top load speed
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