I just got back from the transmission shop, and by what I have told them, they think it might be the t-case.
Blee, I checked the fluid and it seemed good. The banging sound was mostly happening on streets that were full of gradual dips. When going over a dip, or wave in the pavement, the bang would happen. That is when it was worst, but it also happened on fairly smooth surfaces as well, just not as much. Now, if it is in any gear, including reverse, it kind of grinds, and won't put any power to the wheels. I think the tranny is still sending power to the t-case, then it is slipping there. Does this sound like a regular t-case going **** up? Or will does it sound like the t-case I have is fixable. The shop is getting back to me this afternoon, so any knowledge I have before that would really help me out.