Engine of barn find-steps to evaluate/save

OK:

All the valves open and close as they should. Multiple rotations, no scraping sounds at all. I do hear, while rotating, the sound of maybe a lifter falling and bouncing slightly once in a while, prolly sticky and maybe normal?


Counterclockwise, binds at the same spot every time and the "clunk" really does seem to be from the back, most likely trans or converter.. SEE PIC: almost looks like this is hitting inside? I am soaking the cables/shift buttons with silicone. I've no idea what gear it might actually be in. Should it rotate backwards if its in gear?20241012_122144.jpg