differential issues?

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With the shackle worn that bad I would suspect the bushings and spring perches not to be much better.
 
I think if you are not going to rebuild it, I would put it back together as it was. If you shim the bearing then you will have to set up the rear end for backlash all over. If going that far I would be putting new bearings in. You have to pull it to shim it anyway. I also see a lot of wear on the ring gear.

If an axle spun loose in the hub, you are going to need a new hub and possibly an axle shaft as the taper will be damaged and will never hold.
 
It looks like the wear is too great on the ring gear... will rebuild it or try to find one that is in better shape. I found the guide online on how to rebuild it. Not too confident in the carrier pre load adjustment ...the guide uses a special spider gear modified for some all thread. I do have a digital torque reader that would work- maybe I can find a spider gear on ebay.
 
Are you talking about the wheels being on the ground, or up in the air? It makes a difference!

The problem first started when moving the car back into the garage. Heard a fairly loud pop and then would not move at all.

Since that happened I purchased a rebuilt engine with new clutch. Checked adjustment on clutch fingers etc. Have verified that the ujoint at back of trans is spinning. I think the drivers side axel key slid out somehow when I put that hub back on. It was missing when I tore everything down. I spent alot of care in making sure that key fit well- kind of strange!

Plan is now to rebuild it or find a good one to replace it. I live in driving distance to Bert's in Denver will try that first.
 
Had Bert’s rebuild it and just got it back today. They also had to replace the center section, 1 axel, and the driveshaft besides the usual wear items.
 
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