Hi- Yeah, it's close. You need to loosen the bellhousing-to-block bolts and slide the whole mess (transmission & housing) back about 1/2". If you haven't already done so, remove the 30 bolts holding the torus cover to the flywheel. Then lift the engine straight up (or the transmission straight down if you've already disconnected driveshaft, linkage, etc.). The pilot shaft should actually clear the flywheel, but not by more than about 1/8". This is more of a problem on reassembly, trying to not disturb the torus cover gasket that you carefully glued to the flywheel! I try really hard to always do this job with both engine and transmission out of the vehicle, although a couple of times I've dropped a Hydramatic out the bottom- nasty job!

Good luck,
Jack Gifford