Ok, well lets start with the simple stuff first. Did you check anything out at all? Is the belt that drives the hydrostat intact? Do all the idler pulleys spin freely? You mentioned "Rubbery blue smoke". This puts me in mind that the hydrostat belt was slipping on the motors pulley.
Begin by:
1.) Checking the hydro belt. You will probably have to remove the deck to do this.
2.) Go ahead and take the belt off the tensioner pulleys. You don't have to remove it completely, just get it loose so you can check to see if all the idler pulley bearings are good.
3.) The parts book shows an expansion reservoir. I don't know without pulling the service manual is it has a fill level or not, but one way or another you need to see if the hydrostat oil is at the correct level. Even if you already found it has a belt issue, check the fluid level if you can. It may not be servicable.
4.) Blow all the accumulated grass off the hydrostat and clean it. Even if you find that it is a belt problem, CLEAN IT OFF.
If you don't find the problem with this advice, come back and report and we can give you the next steps. From you description, I would say that you have a belt/pulley issue. Let us know!
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