I am installing a rebuilt 46 re in my 2001 2500 2wd. got the trans up and in place. Started snugging the two large bolts with 15mm heads. With about one inch of space between the block and trans I am meeting resistance. Do I not have the converter properly seated in the transmission? The converter is right up against the flex plate. Have I done any damage?

 

No, You need to try to seat the converter. You should feel it go in once and if you keep turning it it will go into it's final position.Then you will have room to mate the two.

 

The torque converter isn't aligned with the pump in the transmission. You need to pull the converter out a hair and turn it a little, then push it back in. Repeat until it aligns with the pump and slides in further. If you leave it tight, it might spin the pump gear with it. If you stopped when it got tight, it should be fine. If you put an impact on the bell housing bolts and tried to force it together, it's possible you cracked the pump gear.