there's a lot of info on these over on correctcraftfan.com. i had the same issue three years ago in my '88 sunsport, dealt with it for a season-and-a-half and then sent it out to Fantastic Finish Marine in Ohio after hearing EVERYONE say that they are the best guys around to rebuild these. the transmission guru on that site said it's a pretty common issue once these tranny's get older, especially since not everyone takes care of them like they should. the issue on your is probably the same, snapped reverse plates. a rebuild was around $1000, get a new damper plate from them for $75-ish at the same time. the newer-style damper plates (look like a "star") are better and cheaper than other sites have them. a local shop quoted me $2200 for the rebuild, so if you pull it yourself and put the rebuilt one back in when it comes back, you'll save about a grand. good luck!
'88 Sunsport, 2250lbs ballast, automated surf system, home made surf exhaust, surf flap, ACME 913, Krypt 6.5 HLCD's, Perfect Pass Stargazer
2007 Centurion Typhoon to be upgraded this winter!