Finally got all the parts to put back the axle.. will probably start the installation today.
Here's a good video for those that want to get an idea of to set the preload on the pinion bearing.
Setting pinion bearing preload on the Ford 8.8" axle - YouTube

I believe the book for mercedes asks for about 8 in/lb of turning torque. Or around 132 lb/pd on the Nut if you use new components

Yesterday, I was able to re-install the rear axle back and all mounts, except brake hoses and the flange nut of course.
Thrust arms went in pretty easy, despite my horror expectations.

Now, the special nut i have for the pinion is in poor shape and i will have to find a machine shop to create a new one. It cots about 60$ to buy new ! (crazy, for a nut)
I haven't installed the new pinion seal yet. Want to wait until i get everything aligned with the old seal and than change the seal.
Looks so much better when everything is clean

Will post pictures soon. Hopefully with the nut in place.

I'm thinking, since i'm creating a new nut at the machine shop, shouldn't i ask them to create one that doesn't require a 120$ socket to tighten ?

You're keen . It takes me under an hour to drop a diff out of a W110-W109 chassis car and there is no way i would work under a car on a diff. Theres too much in the way of expensive bearings and so on to get ruined by dirt.
I have thing which holds the diff to a floor jack. I can lower and raise the diff easily .I also bolt this fixture to a Engine stand and this allows me to handle the heavy diff without having to wrestle it about . it's important that the swing axle bushes are in good condition to prevent noise and rapid wear and you need to be able to measure the movement when fitting the side thrust washers. it's almost impossible if doing this on the floor of a shop.

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Thanks guys for all the help.
Was able to take the car for a ride today. Axle is back on the car and the crazy rattle is GONE.
I have to replace the right side spring shims tomorrow and bleed the brakes again and its done.
Yes. I'd do it again