It will mark the bottom side of the leather since it is a bottom feed only ,it might sew to 3/8" leather if it's not too hard of leather.Otherwise they do hold up pretty good as long as they're oiled properly.
Here's the parts & oper manual,Consew was buying these from Seiko & putting their name on them,so that's why even the Consew machines parts had Seiko on them.Since we are a Consew dealer we have alot of parts in stock for them.
206RB-5oper_manual.pdf
206RBparts.pdf
The 150 is w/o a reducer,the motor will run slower with one since there's less friction.Our box style reducer has a 4:1 ratio & the speed is 15 RPM sewing 20 oz of leather on a CB341,so motor is down to 120 RPM.
I got my tachometer out & the lowest speed running a machine is 150rpm with a CSM-550-1 and that's why we use them on everything.No boards to blow either.
The squeaking is the plastic belt,the tight spot could be lack of oil somewhere,have you oiled everything on the needlebar end?Including the takeup lever,needlebar & all the linkages?
Someone has adjusted your machine for the 134-35 needle which is a mm or so shorter.To adjust for the longer 135x17 you need to loosen the screw on the needlebar clamp that is under the face cover.If you do this be sure to have 1-hand on the screwdriver when you loosen the screw & the other one on the needlebar so it doesnt drop or you'll have more work to do.Then just raise it 1 mm or so.
Schmetz does make a size #21 in a 794S point & of course we have them.And the smallest 7x3 you can buy now is a#19 or #120 in metric,they quit making the #18.
The 31-19 had the shorter arm,yrs ago we used to rebuild these & sell them for auto upholstery machines & after we sold all the machines we could find here,we found a place in the UK that had them & they sent the 31K47 & they worked alot better with the higher walk.
Is the feed dog coming above the needle plate enough?If so you could elongate the slot for the stitch length screw so it goes down alittle more,you also want to check that the feed dog isn't hitting in the front or back of the needle plate.There's an adjustment on the lower feed shaft that sets it.