Take your air cleaner tube from the turbo and feel for up and down movement in the turbo shaft. Should be very little if any. Also look for evidence of the turbine scraping the housing.
Also, examine the exhaust manifold carefully for any soot, they are known to crack as well. I would start it with the hood up, should be evident what is making the noise.
1997 2500 Ext.cab SLT, 4X4 auto, 3.54 gears, posilock, 98/99 steering conversion. New TC, lovin her again! Sold 3/13/2010, gone but not forgotten.
1997 2500 Ext. cab SLT, 4X4, NV4500, 3.54 gears, 4" MBRP Exhaust, Ready to install SB DD3250, built just 216 trucks after Brownie!