This is what Click & Clack have to say about lugging.
"Most of the noise comes from mistimed explosions in the cylinders -- which is called "detonation" or "pinging."
When you lug the engine -- when you try to accelerate in too high a gear -- you make the engine work harder than it's supposed to. Just like you would work harder than you're supposed to if you rode your bicycle up a steep hill in 21st gear -- as opposed to first gear.
When the engine is over-worked, it overheats. The way it overheats is that the temperature inside the cylinders gets too high. When that happens, the gasoline-and-air mixture -- which is supposed to detonate when the spark plug fires -- detonates unpredictably at other times, too. That's called pinging -- when those extra detonations make a sound like marbles rolling around in a coffee can.
And under the worst of circumstances, you can also get piston slap, which is a "clunky" noise. Because you are getting uneven combustion inside the cylinder (the detonation doesn't necessarily happen at the right time or in the right spot), the explosion can force the piston off to one side when it descends during the power stroke. When that happens repeatedly, the cylinder walls get all scraped up, and over time, your car turns into the proverbial oil-burning heap."
