Probably a diff cross pin in a D1. The axles are made of a slightly harder cheese.
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Check axles out first, they have to come out to check Cross shafts in diff centre anyway. It sounds like the Cross shaft as my D1 did exactly the same.
If it will drive with the handbrake on it's the rear end, save you getting dirty trousers haha, if not, put on your overalls, they're dirty underneath!!
Seems to me fellas that the term 4wd is a bit anomalous. Without diff lockers you're surely only going to get 2 wheels driving at once (i.e. 2 can spin in soft ground) and without the CDL engaged you'll only get 1 wheel gripping. Have I got the wrong idea about this?
Tiny Tim
EDIT: just re-read that and I think I'm a bit tired because I wrote the same thing!!!
Without centre diff lock, in loose ground ALL your drive could be lost out one wheel, but a discovery is full time 4wd, drive goes to all wheels all the time in ideal conditions, once you start losing grip then drive gets lost out that/those wheels
Centre diff lock gives equal drive to front and rear diffs, so to stop driving forward (or backwards) you need to lose drive out a wheel on each axle, (1 front, 1 back).
But no, there's nothing 2wd about a discovery unless you put your foot down hard haha!!