Ok, I get it.
I pulled the axle bolts and removed the tube and the "crush" washer.
I stacked up 3 regular washers and rethreaded the bolt back in and tightened it.
The axle moved in and tightened the can looseness, YES.
Removed the bolt, put tube and washer back on and torqued it to spec.
Just RTV'd the diff cover, so I won't be able to refill the diff till tomorrow and give the old girl a road test.
I suspect that the looseness in the right wheel bearing may be the cause of some of the noise... we will see.

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1981 240D 143k 4 spd manual -SOLD

2004 VW Jetta TDI 5 speed 300k -still driven daily

Surprise surprise surprise... the rumble was a disintegrating left front wheel bearing!
I never even considered front wheels and having checked 12/6 and 9/3 on the wheels and only finding the rear wheel loose I moved on and only looked at the rear.
I took it to an indy about 20 miles away and from the looks of the bearing it would not have gone much farther before it seized to the axle.
Dodged another bullet.
The car is back to its naturally sweet diesel only racket and thanks to Snookwhaler I got my axles tightened up to boot.
On to the next repair.

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1981 240D 143k 4 spd manual -SOLD

2004 VW Jetta TDI 5 speed 300k -still driven daily