It's exceedingly hard to diagnose noises from long distance. So I can't say for sure what the culprit is. However, I would be inclined to believe your mechanic. If you decide to go the transmission rebuild route, here's some food for thought.
Scott (KLR3CYL) and I specialize in rebuilding Insight transmissions. I'm confident in saying nobody does it better than we do.
Every transmission gets completely disassembled, thoroughly cleaned and inspected. We replace all of the bearings. We do the 1st and 2nd gear syncro tab-ectomy. This permanently fixes the downshift grind issue. We restore the ball detents on the shift forks if they are excessively worn. There's more, but you get the idea.
We also do core exchanges where we send you a fully rebuilt transmission and then you send us your original transmission back.
Back in 2015, I removed the transmission on my 2006 Insight at home with my dad's help. We lowered it down with a floor jack. The manual transmission weighs about 60 pounds. It is isn't unreasonably hard to manage.
The axle nuts are 32mm. If the car is already on jack stands, you can have a helper apply the brakes while you loosen the axle nuts with a breaker bar.
Edit: If you would like to go with the high quality, tried and true, we have a few Exedy KHC11 clutch kits available.
The tires are worn a small amount more on the inside edge. Given that it's pretty much the same on both the right and left tires, I would suspect that the toe is probably out a bit. You will need an alignment after you do the transmission, regardless.
Passenger side motor mount is kind of a pain, but it is entirely doable.
I was talking about the rear main (crankshaft) seal. I don't know if there is a guide on the forums that shows replacing this.
At any rate, if you would like to pursue doing this I will be happy to walk you through the relatively simple process. Pulling the IMA motor off the engine is not difficult...unless you try to do it the way Honda describes in the service manual. You don't need any exotic tools to do the job.