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It sounds like somewhere, possibly the ignition switch, something is getting hot and sticking in the "START" position. This would explain the headlights not working (you know how the power to the headlights is interrupted when you crank the starter. The horrible metallic grinding may be because the starter motor is staying engaged to the flywheel. As for the O/D, I don't know - maybe the power to that is interrupted also.
Do you you have a ton of keys hanging from your key chain?
Next time it happens try wiggling the key a bit to see if it quits.
It may also be a sticking starter solenoid, but I believe the headlight bypass is a function of the ignition switch. Someone a bit more knowledgeable may chime in.
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