Turns out the diff is OK. Strangely enough, the oil seal near the front of the diff(where it connects to the driveshaft) had melted out of spec and was causing the final drive to bind up a bit. Once the seal was out, the assembly rotated freely. I did not have to swap the bearings.
I HIGHLY recommend the OS Giken fluid for their diff. It has a 250 weight rating. This is DRAMATICALLY different from the Motul 75 140. the Motul is a fantastic fluid, but it just can not match the viscosity of the OS Giken fluid. The OS unit is very reliant on the oil to lock the diff properly, so I would stick with the OS stuff for anyone using this unit.
On a side note, the guys at OS said many people have overheated the diff and they withstand the abuse. So if you have overheated it, there is a very good chance you are OK. just get the cooler on there and change the fluid asap.
Thanks guys.
John
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