Not to complicated at all.
With the motor running and without a driveshaft I can shift through the forward gears 1,2,3,4,5 without pressing the clutch cable. However, I did not try shifting into reverse. This seemed strange to me and I thought it was due to my clutch cable being to tight. I removed the clutch cable completely and It still performs the same. Now, since I drove the mustang with this motor and trans without any clutch problems up until last week and all I did was pull the motor and trans as one unit and drop it into the truck I have to assume that this situation is normal.
I will check the output shaft as you suggested, as I did not think of doing that, and let you know. Thanks for your help
mike