Sounds like the problem is you disconnected the lock cable from the from the lock mechanism, so the key is turning a disconnected cable.
On the right side of the bike, go to the rear peg and reach up under the tail... you'll have to loosen the fasteners and the pop rivets on the undertail... reach up and towards the left side of the bike and try to feel the lock mechanism... on the back of the cross bar there is a small knob, push it toward the left side of the bike (it would help if someone else is pulling up slightly on the seat)... let us know if that helps....