Rear wheel still turns with clutch disengaged?

XS650D

XS650 Junkie
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I have my bike on centre stand,after adjusting the freeplay at bars and at worm gear behind left cover i am finding that i i put tranny in gear the wheel will spin even with the clutch pulled in (disengaged) i cant stop wheek even with my foot,what did i do wrong.If i take the bike off centre stand and test in gear the bike will not pull forward in first gear at idle until clutch is over half out (engaged) is this normal.i find when riding the bike it feels as if the clutch engages when lever is about 70 percent released.please advise,thx
 
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