Setting up a rear is not for the average DIY mechanic, involves alot of detail as far as shims, pinion depth, etc etc. It would be better to take it to a shop then then risk slappin it together and having the rear howl like a banshee driving down the street.

 

It depends greatly on your wrench turning experience, access to the needed tools, and how comfortable you are with precision measurement. I have done 3 Mustang gear swaps, and maybe 10 as a lifetime total. It's not rocket science however you will need a 10-ton+ press, and precision depth gauge and dial-indicator, in addition to common tools.

This is one of the best write-ups I have seen.

 

Don't go buying a whole new carrier just because you are having trouble figuring it out. I would assume that piece is a lot better than a OEM unit. If your not already a member of the Corral Forum I would go over there and someone will be able to help you. It has members with real good knowledge

 

I'll check out corral form this eve, thx. As far as working on it, I figure i'll replace it as an absolute last resort. Its prob something simple that i'm overlooking. Thx guys

 

So in case anyone runs into this issue in the future....
i took it to a diff shop. They had to take the carrier apart. There was some gunk and metal flakes in between the bearings and shims. The guy I bought the car from didn't install it right. Once they put it back together, the axle spacer slid right in.
was a torsen true-trac btw.
fyi
luke