Diff play

[pentoman]

Been reading up this morning on diff slack; can't work out why my car ('90 190 16v 5-speed) is hard to drive smoothly. Jerks when you come on/off the throttle and when you change gears, and makes quite a bad clunky sound while it does it.

Here's a pic of the diff:





Which would seem to be leaking a bit...

Also some pics of the subframe bushings which look okay:



And here's a short recording of the diff play present:

http://video.google.co.uk/videoplay?docid=2371554832629103608

Not too bad, bit worse than my 190 2.0. So what gives? Front prop coupling looks quite new. Can't see centre of prop it's covered by an exhaust shield, but I tested for slack there and it seems solid.
Car does also vibrate at speed - maintain constant speed and vibration comes and goes like an oscillating wave.