I blended all my transmission gears on my 740Turbo manual last week and
I am in the process of swapping in a used M46 tranny I picked up at the junk yard for approx. $1,000. I am also replacing the clutch, pilot brg, oil retainer gasket and drive bearing.

In the process, I had my flywheel resurfaced and noticed that one of the two nipples that sticks out on the back side of the flywheel approx 1/4 inch, just below the ring gear was pushed in flush with the surface. I can still see the jaw marks made by the surface grinder in the vicinity of the pin and I think the machinist needed to push the nipple in in order to get the flywheel flat for machining.

There is also some sort of cylindrical sensor on the exhaust side of the engine bellhousing with two little holes on its end and I assume this is the crank sensor or Rpm sensor. However, I thought the sensor only came on 1989+ models, not on my 1988 model. I assume the two nipples on the flywheel interact with this sensor.

Anyway, does anyone know if having one nipple flush with the flywheel will be a problem. I do not want to reinsall the tranny and find that I have a problem and need to remove the tranny to raise the lowered nipple. By the way, I don't know how to raise the nipple anyway as there is no where to grab.

Further, can anyone explain to me why the flywheel needs to be installed in a specific position as noted in the facts. I follow the instruction relative to TDC but cannot figure why.

Thank you to all who reply.