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the clanking sound is probably the bendix gear on the starter being energized and contacting the flywheel. The ignition switch may or may not be the problem. if you turn the key slowly or wiggle it does the clanking sound go away?
you may have a bad ignition solenoid on the starter. a new starter is 192.05 for a Bosch part from
http://catalog.auto-parts-wholesale.com/?make=VO&year=1996&x=106&y=1
the ignition switch cost of 400.00 sounds a bit high to me, i would do some further looking if i was you.
Dan
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