When I start it up, I hear something knocking or tapping. After about a second, it fades away. however, I can hear rattling if I step on it at rpm's above 2k. It still has power, but it misfires sometimes.

I showed it to two local mechs. They said it was something in the crank. I talked to my best friend, also a mechanic. He says its in the valves and lifters. Who should I believe? He said its the heads for several reasons. One being that it takes a second for the tapping to stop. This means it takes the oil a second to get to the heads a neutralize the problem.

 

If your oil pressure is pretty steady (rises with RPMS,IDles around 20 or so) I'd say its more than likely the valvetrain, it could be just rockers out of adjustment, but it could also be a lifter on the way out.

If you can feel the thump through the petal its probably a spun bearing.

Also it could be an exhaust manifold leak.