The crystal filter in the NC-2-40-D works great on CW if the IF is properly aligned (it probably isn't if it hasn't been touched up in the last 10 years). You may also need to clean the crystal itself if it doesn't provide a good response. The older HRO manuals provided instructions but basically you disassemble the crystal holder and clean everything with isopropyl alcohol and wipe it dry with a clean paper towel/cloth. Handle the crystal element by the edges and use the paper towel to hold it by the edges after cleaning.
After reassembly you can use your signal generator and scope (or sensitive RF voltmeter) to make sure it works. Hook the crystal between the hot lead of your generator and the input to the scope, tie grounds together. You should see a sharp peak when you tune the generator through the crystal frequency. After reinstalling in receiver, carefully tune your signal generator for the crystal peak and then align the IF on that frequency. The crystal filter will give you nice single signal CW.
Happy CWing
