I messured the slop on the rear inner gear and it is close to 10 thousands of an inch. My friend said that this is becuase of wear over the years and says the only way to correct this is by adding a 10 thousand of an inch shim in between the thrust washer and the rean inner bearing.
Mine was about the same Daniel. There is supposed to be a gap as the gear spins on the shaft, but yeah, it does sound excessive. A few thou is plenty I think. My t-case made an annoying loud grating rattle when coasting at speed. Not under power, but not so light on the throttle as to be decelerating. I think it's these big gears rattling back and forth when there is no thrust one way or the other to keep them in place.
I think your case may end up giving the same rattle. If you're going to shim it, putting a shim between the washer and the gear is not a good idea. The gear spins on the shaft and a shim a few thou thick up against it won't last long.
What I suggest is to machine the thrust washer. Put it on a lathe and bore out a recess on the side that seats against the shoulder on the shaft. Just big enough in diameter to clear the shaft shoulder and deep enough to take up some of the slack. Then, put the shim bewteen the washer and the bearing. If you bore it 5 thou deep for instance, put a 5 thou shim between the washer and bearing and the bearing will still be sitting where it needs to be. (Actually, even this probably isn't needed. If you've got at least 5 thou in shims at the end of the shaft, you could take some out there to compensate instead.)
Check your front output too. The big gear will likely have as much slop on that one as well. That one's a bit harder to fix though as there's no thrust washer.
--Dan