Yeah, David, that clutch basket clicks pretty loud when the plates wear down. I wonder if that's the sound he's hearing, and it just seems to be coming from farther back. The basket sound is a loud tic-tick-tick about 5-6 times per wheel revolution.

When the reverse plates wear enough, they begin to break up into chunks. When you put it in reverse, every now and then a chunk will catch and you can back up. These chunks are clogging the filter and getting everywhere. The clicking is throwing shards of aluminum from the basket throughout the tranny.
Reveres plates are the easiest thing to fix in a 722. Do it before it's too late.

DG