I mean, before shaking it like that, I rotated the spring relative to the the rubber mount it sits on.
First, the knocking sound is the upper strut bearing. It's either improperly installed, incompatible with the strut, or has failed.
If you were actually able to rotate the spring, that's possible when people put lowering springs in cars. Sometimes lowering springs are too short to firmly seat into the upper and lower perches/pads when the suspension is at full droop. With poorly designed springs or incompatible or improperly matched components - specifically lowering springs and struts - the springs will sometimes flop loosely when the suspension is at full droop. This is not good.
To get around the "too short" spring issue is why many aftermarket lowering springs are progressively wound. A progressively wound spring enables the spring to be long enough that it remains seated on its upper and lower perches when the suspension is at full droop, but when the car is lowered the closely wound coils become "coil bound" and are effectively no longer part of the spring's overall stiffness at ride height. From the rust patterns on your springs you can see those coils are "coil bound". Understand, being coil bound like that is not necessarily a bad thing with lowering springs. The goal of the progressive spring design is to keep the spring seated on its perches when the suspension is at full droop.
Anyway, your upper strut mount/bearing is either bad or mismatched relative to the strut. And BTW, since you were able to rotate the spring, make sure it's proper aligned on the perches (pay special attention the lower perch and pad) before lowering the car.
Edit: One last comment. You said you verified the strut mount was tight to the body. Be sure to check that the strut rod is tight in the bearing. Doing this often requires a "crow's foot" tool to tighten the nut on the strut rod, a tool which people might not have. As a consequence the nut on the strut rod will not be fully tightened and will work its way loose over time.
Scott
