[quote=RC Geezer;11940291]I think you hit the nail on the head! When I disassembled the trans, the bearings are in fact larger- ID - than the -OD- of the outdrives.

What do y'all think, did this possibly damage any other gears or components?

Here's a video of how much slop there was in the trans/diff .

Yup, that's what you've got. Someone sold you a truck with a mismatched gear case and diff. I wouldn't be too terribly annoyed at this point. It's an easy mistake for a new mechanic to make. So you have a choice to make at this point....switch the the larger outdrives or keep the diff you have and convert the gear case and bearings over to the diameter you have. I honestly have no idea which would be cheaper. If the vehicle was run for quite a while like that there might be quite a bit of dirt inside the gear box and the gears might be kinda toast anyway. The best thing to do at this point is take the tranny apart, clean everything up and inspect the gears themselves. Good luck, man. This is one of the risks we take when we buy used online like this, unfortunately.