I did a bit of research as I vaguely remember seeing this problem here a couple of times way back when. Reading elsewhere, it's a problem that has seemingly frustrated a number of 740 wagon owners over the years. People often either give up and learn to live with it or destroy the seat getting it out and replace it with a good used seat.
Your 60/40 wagon seatback has the release handles recessed up high on the back of the seat, close to the outside. The release handle is directly connected to the latch mechanism at the top that engages the catch on the pillar. The wide 60 seatback is the usual problem side and the common problem is exactly as you figured, the hinge lock on the opposite side at the bottom won't release and something is broken inside the seat. The latch mechanism at the pillar will normally release and you can move the seat forward a little, but that far hinge lock is preventing it from going any further forward. The seat is impossible to remove in the upright position. The fasteners are simply not accessible.
BTW, those spring-loaded flaps behind are part of the forward floor panel. To remove that panel, you remove the surface fasteners and the screws holding the large curved metal lip at the front. If you can get it off, great, the spring-loaded flaps will be less of a nuisance for you, but as I recall the seatback needs to be forward to access all the screws at the front edge of the lip, which is off course not an option for you. Once all the screws are off, the floor panel has to be slid forward a bit to release a couple of tabs underneath. Not to worry, you don't need to remove that floor panel for the suggested procedures.
In the below schematic you'll see there's a linkage rod from the release handle mechanism (#40) that goes across the top to the far corner connecting to a vertical linkage rod that goes down to the hinge lock mechanism (rods #33 & #39).

The common problem seems to be the plastic bits used in the linkage rod assembly can become brittle and break. It's hard to tell, but I think it's the pivot connection #3 that commonly breaks (p/n 1345433, still available in the Volvo parts chain) or maybe it's the pivot itself, shaft #35 (p/n 1338668, listed as call your dealer, so likely unavailable). It may also be the connector attaching the linkage rod over at the release handle. It's hard to tell, but possibly it's clip #36, hidden next to #37/38, (p/n 1354048, still available).
BTW for others following here, the 240 rear bench seat has the release handle on the back in the middle, connected by cables to the latch mechanisms at the pillar. 240 wagons seem to rarely have this problem, but I've read it can happen and it's the cable attachments. It never happened to the 240 wagons I've had. 900 wagons have a similar 60/40 seat with a similar linkage rod setup that uses some of the same parts. In 900s, the release handle was changed to a release lever at the top. I've never experienced such a problem in my two 940 wagons and haven't read of any cases. Volvo presumably improved the later 900 design.
Okay, now first how to release the seat. You should have a fold down armrest. This is seemingly the best trick to try. If it works for you and you only rarely need to release the seatback then this may be all you ever need to do. Push into the side liner of the armrest recess, trying to grip the vertical linkage rod and lift it up. Wiggling/prying the seat back up/down/back/forward and/or having the latch disengaged at the pillar while you try to lift the linkage rod may aid in releasing. I just tried doing that on one of my 945s without any luck. If you can't get a good enough grip, you'll need to try bending the rod inward to the opening, either somehow getting your fingers behind it and/or pushing from outside. Blunt nose pliers could help get a grip, but will leave marks (who cares). If you get desperate, you could poke through needle nose pliers to get a grip or, for full access right down to the bottom hinge lock, cut the stitching or make a slit at the back (worry about the repair later).
If you don't have an armrest or failed above then apparently you can try to getting a hook to grab the latch to lift it or poking a hook through the upholstery to grab under the end of the linkage rod to lift it. Again, wiggle the seat while doing this to aid in release, obviously a trial and error process. Stare at the smaller seat for ideas and practice, removing that seat as needed.
All the solutions I've seen after that are forcefully bending the entire seat forward to get at or break the hinge lock, not at all an easy task for a safety designed Volvo seat. It will basically destroy the seatback. I think hacking through the front upholstery to get at the hinge lock would be simpler.
An initial thought I had that likely won't work was removing the carpet panel from the back of the seat for access, which will require cutting around the edge. It may even also be glued. I initially though this had possibilities of being able to get at the linkage rod. However, as you can see in the schematic, there only a couple of small slit openings through the back of the seat frame. Access to the hinge lock may still be difficult or impossible. I didn't read where anyone has succeeded trying this, plus it would make a bit of a mess to put back.
As for repair, once you've got the seatback released, most people seem to opt for simply replacing the seatback from a wreck. If you think you can keep using the grab the rod trick then why bother. If you have upholstery skills or take it to an upholsterer, you could peel up the upholstery skin to gain access to the linkage rod assembly for repair, requiring stitching when put back, but you may not be able to source all the broken bits (like those listed above).
One of the better places I found while researching your problem and the above repairs can be found right here in the 700/900 FAQ https://www.brickboard.com/FAQ/700-900/InteriorSeats.htm#SqueakinWagonSeats That's where I first read of the the grab the vertical rod method. Be careful in the FAQ and elsewhere, some things mentioned apply to different seatback designs, such as 240 wagons, and comments elsewhere online may apply to 850/V70/S70 models where that problem is seemingly more common than the 745 seatbacks.
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Dave -still with 940's, prev 740/240/140/120 You'd think I'd have learned by now
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