You say that the action locks up when fired or when a dummy round is chambered...
Does the action lock up if the bolt is closed on an empty chamber?
The dummy round that you tried. Did you make it from a fired round or did you use a commercial made dummy round (plastic or metal)? Did you full length resize the casing before inserting the bullet. A round fired from a different gun has expanded to fill the chamber of the gun it was fired in (which is not the same size as your gun). Odds are that if a casing is not resized, it will jam when inserted into a different gun.