Quote:

I have a noticable "clunk" into 1st and a slight lurch forward. I have a slight sound going into 2nd, and smooth all the way up from there.



Welcome to the site! You will soon be nuts like the rest of us.

Your clutch plates are hanging up. When you shift into 1st just after startup, it's normal for the bike to lurch a bit because the plates stuck together overnight. But when it hangs up in the 1-2 shift, something needs adjusted. Your clutch might not be completely disengaging. It's not a problem in 3-4-5 because those shifts don't really need a clutch anyway.
And I'd be willing to bet that it doesn't downshift while stopped very well, does it?
Adjust the clutch and see if that works.

Steelheart- '03 Speedmaster Black/Yellow The Hayabusa Killa 16" Shorties/140 mains/Airbox drilled Procom CDI "There is no cure for Celibacy. But we can treat the symptoms."