Yeah it must still be flowing properly or it would throw a CEL. At least it wasn't something in the engine. It makes sense now that it only does it when you take your foot off the throttle. I bet the air pressure is keeping that loose piece in place when you're driving, once you take your foot off the throttle the pressure in the exhaust drops it's free to vibrate.

Sucks because cats are expensive and the aftermarket versions suck, if you plan on keeping the car for awhile longer I'd bite the bullet and spend about $200 more on an OEM cat.

Or you could put up with the annoying noise until the car starts running like crap.