Yesterday my son was going to use the Scag and the key switch went tits up, it literally fell apart. Today I went and purchased a new switch. After installing the switch I turned it on and fired up the mower (Mower is pull start only). Now turning off the switch does NOT kill the mower. Completely removing the switch does not kill the mower which is even more confusing. I did a continuity test and the switch is fine. Does the switch need to be grounded to the frame for it to function correctly? If so this should not be the issue since it came with a new washer that has teeth on it. Connection is nice and tight and is making contact with clean metal.
The other safeties that typically kill the engine (hand levers, brake, neutral) still work normally. Mower model and serial below.
My guess is that you don't have the correct switch. They may look the same, but the terminal location is different. Hopefully you still have the old switch. Look at the terminals on the back of each switch (they are labeled) and make sure each terminal is in the same location.