Thanks guys,
3-speed vs 2-Speed.... hmmm good question, I think you are right. I also picked this up second hand from someone who had run it like a week, not sure if they found something as an accessort or it's time I clean off my work bench so I don't mix stuff up. I'll bet I snuck another gear in there over the month. Damn, hate it when I mess with myself.

Assuming I am insane and you are correct, it still would have been 2nd gear that I used.
The motor was a C-50-11L
http://hackerbrushless.com/motorDetails.aspx?series=C50
[BYTE - Cool conversion you made! A few hours ago I bought a LST2 from eBay, and I also want to convert it to brushless. But I never made a motor mount. Could you please tell me which tools you used for making that motor mount on your LST2/Mega Baja? And do you have more pictures from the motor mount? ]
I fabricated it using my Proxxon Mini-Mill
http://stampedeproject.com/Proxxon-MF70/
Quite frankly this was a bitch of a conversion. If you look at the clutch on 2nd gear the smaller of the two, you will see that it has a hole to adjust the clutch on the gear. I just removed that screw and installed a long one, then drill a hole through the opposite edges clutch plate and clutch and added a second screw to effectively lock the clutch. The 1" wide 3/4"'ish thick Black Derlin spacer just has a hole through it and I screwed a washer, spring and stock nut back on - you could probably do that last part with washers.
The other thing you will notice is that you need to figure out your gear mesh, remove the spur, tighten the motor down, then re-install the spur. Not that I plan on doing that once a day or month, but still a pain.
Click on any of the images on my site for a larger picutre - (warning they are 6MB high res images) but you will get the detail.
http://stampedeproject.com/Losi-Mega-Baja/
Really big 6MB picture of the clutch.
http://stampedeproject.com/Losi-Mega-Baja/IMGP7803.JPG