When I shift from reverse to low I get a clunk engagement rather than a smooth transition. Other than that it shifts and drives great.

 

Not sure, but could it be the U-Joints making that sound?

 

The U joints are fine. Its a transmission issue. Thanks John

 

I had a similar issue, turned out to be the 4 bolts that fasten the prop-shaft top the diff were loose. Nipped them up and noise gone. It sounded like it was coming from the transmission, even when the car was up on a lift the clunk sound seemed to transer through to the gearbox.