I also have a 1986 25' and seemed to have developed the same problem you originally posted. My coupler locks around the ball, but when I raise the jack to install the w/d bars the coupler arm lifts up as I raise the hitch. The coupler seems to be locked, since I can left the tow vehicle right up with the hitch.
What did you finally end up doing to repair your problem. Was it just cleaning it or did you need to replace the coupler lock as Andy suggested.
1986 Sovereign 25' CB
2007 Chevy Silverado 1500
2007 Toyota Land Cruiser