I had the same noise. The rear u-joint on my front drive shaft was completely shot. Took it to a local dealership since I'm the original owner (lessee) and it had under 100K on the clock. They did about $2K to $3K of warranty work for me including hubs, half shafts and new drive shaft. All I was looking for was a new u-joint! I figured they took advantage of the situation to boost their income in a bad economy since Kia reimburses them for warranty work.

01 Convertible; Electric Fan; 3" Up Your Kia lift spacers; Tj 104's; 31x10.5x15's on Centerlines; Rear LSD.
GONE, all I have left are a few spare parts and the wheels.