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I pulled the trasmission tunnel in my BJ8 with the idea of gluing heat barrier material to the inside, with the reflective sheet towards the transmission. Is this the proper way to do it? Any thoughts on what adhesive to use?
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Roger--
Heat insulation materials with reflective foil surfaces, etc. are designed to have the facing oriented toward the heat source. However if the insulation can deteriorate from the elements (including oil spray and water) this would not be a good plan. Dynamat (and other metallic or for that matter ceramic) sheet insulations will not rot, compress, etc. and it is mastic-backed so you don't have to deal with adhesives.
If you're lining the inside of your tunnel be careful that your material does not short out the OD solenoid, though again Dynamat is thin enough to use in this application.