I presume you are have a 2wd mate. What you are hearing is piston slap. Yes it is normal on a 2wd. the noise is the piston hitting the bore and the reason it goes away when the car has warmed up a bit is coz the piston has expanded a bit to fit the bore properly. The 4x4 pistons dont knock because they have a off-set gudgeon pin which keeps the piston straight.

Thats how i understand it anyway. Im sure if im wrong someone will tell me, but that is what is happenin to your car.

Doesnt nessaceraly need a rebuild. HTH