On the 97 there is a cable that runs from the shifter to brake pedal to ig lock. The trans must be in park , foot off brake in order to turn that last little bit to remove the key. It should click as the key is withdrawn from the lock. There may be a cable problem here or the lock system is wearing out.

When you split the housing of the new fob you can transfer the entire metal portion to the new fob. Also, when using the key, grip it near the base and not at the end. Gripping at the end tends to split housings.