Some more information on the "cup" which the FSM calls the "circular packing". The 87 FSM diagram on page 9-34 would seem to me to imply the packing was a cylinder which is of no help. The 89 FSM diagram on page 9-26 clearly shows the open end of the packing toward the front of the engine and the closed end to the rear. The front edge of the packing is flush with the rear edge of the larger diameter (the oil gallery I presume) section in the middle of the rear bearing cap.

1987 Raider 2.6L 5 spd w/ LSD off road package 130K miles
1987 Conquest 2.6L 5 spd w/ intercooler 56K miles
2000 4Runner locking RA 34k miles