When I had my starter apart I noticed that bearing too. From memory mine was a sealed unit though (i.e. the bearings come pre-greased and then sealed with little orange dust covers inside the bearing run.)

I just lubed the end of the shaft with copper anti-seize compound and wacked it back together.

I might be wrong though, I'm sure one of the more experienced gurus will chime in <img src="/forums/images/graemlins/smile.gif" alt="" />