Yes, you can do the "Baylor" method without dropping the differential. It's how I did mine. However, from your description of the tracking problem, I would definitely suspect those trailing arm bushings. I had one that was nearly gone that caused strange tracking problems on mine. They can appear OK until you drop the trailing arm.

When you decide to do them, you will need an MB spring compressor. And unless you are young, Epsom salts for the tub soak afterwards......doing that much work on a suspensions is a workout!

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Sam

84 300SD 350K+ miles ( Blue Belle )