Glad to see you back. The bike looks good.
No, they don't coast at all, if you are talking about pushing them around the garage. The extra pulley is supposed to have spring tension pushing down on the belt, tightening it, and keeping it further into the driver, thus keeping it in a lower gear. (Or at least that is how it was explained to me) On my Powell, it was barely noticeable either way. Go ahead and get yourself a longer belt of high quality.
There should be a tang, (A bolt and nut) in the frame very near where you have the tye wrap that holds the arm in place.
Here is my Comet 20, belt, and driver with spacers in it to convert the Powell 5/8 to the Comet 3/4. Note bolt holding arm.
View attachment 100999