[klondike98]

Here's a tutorial on safety caps that makes it clear when you use X and when you use Y and what an X1/Y2 is. Basically you use an X safety cap across the line neutral and hot, use the Y safety caps when going from one side of the line to ground and you can use the X1/Y2 in either situation.

If there are still paper caps that have not been replaced, there is a good chance that may be part of your distortion problem as well. You asked if there are more caps in the center section. I've not worked on a 37-630 so I'm not sure but I've read some other threads that you do need to get into that subsection to replace caps. Here's one service tip on those subsections I located: http://www.philcorepairbench.com/tips/svctip02.htm and here's a thread on the topic: http://philcoradio.com/phorum/showthread.php?tid=15