Knock/thud in rear diff, driveline or gearbox after changing gear

Hello everyone

My first post here, I'm new to 4x4 adventures and have brought my first toy. MY02 IO 2.0L 4door manual and has come with a few issues but enjoying cleaning it up and fixing things as they arise.

It feels like there's a big gap somewhere between the gear knob and the tread lol wanting help to pinpoint what the problem could be. I'm guessing a universal joint, rear diff rebuild or gearbox rebuild? It's hard to engage 3rd gear at a high rev change, clutch was done in the last 50K kms apparently, no other gears grind, clutch feels good, driveshaft doesn't rattle

BUT... after using 4H in the wet for about 20kms the klunking after changing gears has reduced a lot...what are your thoughts please and thanks in advance


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