We've often seen contact between the CPS and flywheel reluctor wheel related to internal failures, and even a broken crankshaft on a couple of occasions. Wear of the main bearings, or a failure of the crankshaft end float shim(s) can also instigate this contact.
What flywheel is fitted to the engine? OEM? I see it was "used" but was it used OEM?
At the end of the day the CPS contact isn't normal, and is likely a secondary factor associated to another underlying condition.

 

It will be interesting to see if your rms has started to leak. Do u have a dial indicator to check run out on the crank?

 

Crank it with the CPS removed and see if noise is gone.

 

The flywheel us a used OE. Motor still idles after it finally starts. Working on a support bracket do I can remove the trans.
I agree its not normal for the CPS tontouch the flywheel. The motor had run fine with no incidents over the past month with this cps and flywheel combo. I'll report back when the transmission is off and I can check runout of the crank and flywheel.

 

Just like theprf said, probably just the wrong cps after the tip to 6mt swap.

The tip cps needs to be changed out to the shorter cps used on the 6 speed.

Thats what I'd try before taking down the transmission. CPS are cheap and easy to change out. Worth a try. Then, maybe after a few miles, remove cps and check for signs of damage.

jmo

Does your used flywheel numbers match up with oem 996 DMF or a Luk DMF...?