Assuming it is as suggested above the "output gear" actually is the transfer case input gear wearing on the gearbox output mainshaft - this is easy to check on a 96 defender
1/ remove PTO cover at back of transfer case. 
2/Pry off the rear input gear race housing.
3/You will no be able to slide the input gear out and quite likely from your story you will have stripped out the splines of the R380 gear box mainshaft output.
Now the good news, assuming your 96 has not been altered (as in it is factory) you have a quick easy and relatively reliable short term fix. Source a new cross drilled input gear of the correct type.
The newer cross drilled gear engage on the entire mainshaft spline and with some cleaning of the main shaft you should be able to slide a new cross drilled input gear onto the shaft and bolt it all up.
Assuming this is your problem this will get you mobile again very quickly and cheaply.
The proper fix is to rebuild the R380 gearbox or source a newer one.
I drove around for about 40,000km all over the Cape on just such a temporary mod up until last weekend when I finally got around to changing out the gear bag and t-case 
Steve
				
			 
			
		 
			
				
			
			
				'95 130 dual cab fender (gone to a better universe)
'10 130 dual cab fender (getting to know it's neurons)
			
			
		 
	
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