[Arran]

I think that we need to clarify here, the Model 86 is NOT strictly a TRF, it's a Neutrodyne TRF, or a "Neutrodyne Plus" as Philco called it, as opposed to the Screen Grid Plus chassis which are also a TRF but do not require neutralization thanks to the screen grids in the RF sections. Philco had a Hazeltine license, as well as an RCA one, and Hazeltine Labs did the original design work for most of the early Philco models such as the 511, the 86 is sort of a hold over except that it uses a pair of #45s rather then 71A. The small variable cap is probably used as a form of gain control on the front end, on strong stations you detune it a little so the set doesn't blast your ears out. The rheostat on the top is a hum balance control, it's wired in parallel across the #45 filaments, you could try adjusting it if you can't find another source of the hum.
Regards
Arran