Ok here is an update after putting the engine back together and re-mounting. I now have the engine not "knocking" for the most part. Overall I think the engine just needed some care and oil for lube. Putting the engine back together I have come across the fact that your right, the engine is very tight and close to being too tight. I put the backplate on and secured it then noticed the shaft wouldn't move at all! Took some strength to move it a little. Took the back plate off, and turns out the piston wasn't seated properly in the shaft ring so was grinding against the backplate and leaving some metal shavings inside. So, cleaned out the shavings and re-lubed a little. This time the backplate seated fine and no problems. However though, putting the head back on the engine created the issue all over again. Once I had the head seated back on, the compression was really great and my "knocking" started again

This made me suspicious that the compression ratio was too high with the bolts on the head really tight. After about 10 minutes of playing with the bolt tightness I was able to make the head be snug and the knocking go away! Got the glow plug on and check for any air leaks and found none and the knocks are gone and the engine feels normal now when turning over. SO, very interesting finds today. Seems this engine is needing a breaking in and was manufactured a little tight. Good news and glad I figured out a way to make the knocking go away because it was sure an annoyance! Thanks again for all your help and tips

Will keep them in mind again if I encounter a similar situation.