I have the noise and can feel it clunking too, but only after I've pedaled as fast as the bike will go and then let up on pedaling. At 60-80% speed pedaling, letting up and freewheeling it there is no noise or feel of a clunk.
That's the POS (Long Yih) they put on it, you guys oil them, why not grease ? I guess it being sealed would make that hard to do, but are they greased or oiled at the factory ? The noise is disturbing enough, the feeling of the clunk is even more disturbing. I was thinking with going with a Dicta, but others say those have at least the noise and then I was thinking about the Shimano SF-MX30 and then I saw the other post that indicated the noise. I've even seen a SunLite/Pyramid brand ? These cheap Chinese parts are really dropping the ball on toy manufacturing and their QC. This is on a new bike, I've maybe ridden it a few miles. As for oiling, something like 30 or 40W ? Hell, maybe even 80 or 90W gear oil for an automobile manual transmission ?