Replacement starter drive gear does not have big spring on end like original and is 1/2 shorter overall. If installed, drive does not contact ring gear with starting. Could this be the wrong starter drive or am I installing starter incorrectly on engine? Orginal starter drive worked but would crank for awhile then spin off (ring gear). Thanks

Sounds like you have a '65-up or "late" style starter drive. Take the old one with you and match it. All the '58 through '64 FE engines used the "Flo-thru" starter drive with the spring on the end as you described.