BMW Repair: Speedometer Inop. / Noise under car when slowwing down, hub flange, drive axles

Question
Got a 528i Wagon 99 model. The speedometer is not working and the ABS light is on. Suspect speed sensor in trans. & figure that the speedometer not working it is causing the ABS light to come on. Just wondering if the speed sensor gives many problems on this model or if I need to look elsewhere?   Also I'm getting a knocking noise under car(seems to be at the end of the drive shaft) when slowing down to a stop. Can't seem to determine if it's in the back of the drive-shaft or the left rear axle. Any tips on this? Thanks for any help on this.  J.C.

Answer
James, speedo is driven off the wheel speed sensors not the trans output speed sensor. You have four of them. I believe the speedo uses the right rear sensor if I can remember right. try swapping the sensors from side to side. The control units on those cars are habitually faulty also. Inspect the rubber flex disk on the front of the drive shaft on the trans output flange for tearing. Inspect drive boots on the drive axles. Also wheel bearing are common. If you do replace the bearing also replace the retaining nut and hub flange. They usually make noise more consistantly. Jack the rear of the car up and turn the DSC/ASC off. and have someone in the car to drive it and hit the brakes to pin point the noise.
-Evan