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If you have a stock 206-545C, your axles are running in the aluminum-alloy case "bushings." Upgrade to needle-style axle bearings: Peerless P/N 780140 Bearing and 786084 Bearing Sleeve (you'll need a pair of each). Press the bearings into the sleeves so they are centered (always press against the flat side of the needle bearing, the side with the writing on it), then install them over the axle ends while you have the axles and differential out to lock it. I would also remove the input shaft and pack the needle bearings with more grease. And to prevent possible gear-teeth interference between 1st-speed driven gear and 2nd-speed driver gear, add one 780051 Thrust washer to the countershaft just to the right of the C-ring that holds the 1st-speed driver gear onto the countershaft (between the C-ring and the 2nd-speed driver gear).
Well guys i think im just gonna suck it up and spend the money on a live rearend and use a 700. this seems more reliable and in turn alot easier to build.