Chevrolet Repair: 1985 chevy K5 350 w/4 speed automatic, haynes mannual, chevy k5

Question
hello Van,  I recently purchased a 1985 K5 Blazer. The vehicle came original with a 305 2 or 4 barrel carb, 4 speed automatic trans. I have learned that it now has a 1989 fuel injected 350 with a 4 barrel carb on it (intake leaks oil). I am no mechanic by any standard, but have been able to keep my vehicles running 25+ years with hours and hours of reading Haynes mannuals. I recently replaced the instrument cluster (printed circuit bad on original) with a salvage yard one that does not accept the LED speed sensor (it has no power when tested w/engine running). I not sure if any of the computer controls function. Another odd piece of wiring is an electrical switch or sensor on top of the transmition that has been wired directly to the fuse box (hot when key is on). The previous owner stated that the truck had (set up) several months. The motor starts easy, shows oil pressure aound 30lb+ running in 4th gear, thermostat working, idles good and seems to have plenty of power. But, now it has blue exhaust smoke on right side (passenger) and  developed a knocking sound around the torq converter/flywheel area that increases with vehicle speed. I have changed the engine oil and driven it around town (no 4 wheeling or hard driving). Someone suggested that the knocking possibly is because the flywheel is cracked. I removed the flywheel/torq converter cover, but did not notice anything obvious. The knocking sound seems to come from the torq converter? I call this Blazer my Frankien-truck, the only thing that appears to be original is the body! Any suggestions would be greatly appreciated.  My Haynes mannual needs a break!  thanks dan  

Answer
Hi Dan,
For the knock, since you had the cover off, unbolt the torque converter, and slide it rearward toward the tranny, and start the engine. The knock could be loose bolts, cracked flex plate, broken drive ear on the converter that drives the pump, or....this will require shutting the engine off, pry the crankshaft to the front, and then to the rear, and see how much movement there is. A soft thrust bearing throw on the crank will allow it to move foreward and the crank can hit each revolution.

That knocking will probably have an effect on the knock sensor also, and retard the timing.
I have no idea about the switch on top of the tranny.

Van