[Arran]

I have two of these things, one is Canadian made the other U.S made. I haven't encountered any problems with the battery/AC interlock switch on mine, just the usual capacitors and resistors including a bad mica in the oscillator circuit, it's nothing more then a spring loaded slide switch so if you give it a good cleaning it shouldn't cause any trouble. One thing that I should warn about, the chassis in theses sets are cramped, the underside of it not only has to fit the caps and resistors but the back side of the speaker as well. If I were you I would keep the 117Z3 tube in the circuit, they work perfectly fine, are inexpensive to replace, and they only take maybe 30 seconds to warm at most, if you use a diode then you will have to figure out where to mount a 10 Watt resistor somewhere on the cramped chassis. It would be rare for a power output transformer to be bad in one of these sets but if it is you can salvage one off of another battery set or portable using a 3V4, 3Q5, etc.
Regards
Arran