Removed the left side sprocket cover and discovered old caked up oil in there, Near where the gear selector rod is.  I have noticed that it can be hard to shift sometimes, especially in lower gears. Can someone tell me what might cause this? 

The sprocket cover you mean? Crap gets flung off the chain and lands everywhere in there. Just clean it out.

Not moving = hard shifting - always
Moving (even slow) = shifting is easy

The gunk is not doing anything to your shifting. Clean it out. Make it pretty in there.

Ok thanks for the input! I'll clean her out and check it again later after a few rides.

An oil change (if not done recently) can make shifting easier. Also make sure the clutch is adjusted properly.

regards
Mech