I'm having difficulty picturing where the problem is. If the locknut is loose and the carrier bearing isn't attached, are you saying the driveshaft won't compress?

The only thing that comes to mind is if there was grease that got on the end of the shaft, it might cause it to act as a piston and stop the shaft from compressing.

Is the rear differential suspended?

__________________
Sam

84 300SD 350K+ miles ( Blue Belle )