Did the engine you're using have a manual behind it or auto before you got it?
If it was an auto, you will need a spigot bush in the crank register for the gearbox input shaft to sit in.
I agree that the clutch disc might be hung up on the input shaft splines.
Try taking the clutch off and see if the box goes up all the way.
Then you'll know if it is the clutch alignment.
