Ok so I just gave up and took it to the family mechanic. Looks like it may be the transfer case or rear drive shaft. Unfortunately I'm betting its the tc because I couldn't shift it into four wheel drive. There was quite a bit if grinding. I will know by Monday so ill keep you guys posted.
My buddy had a bad tcase in his old yj. Apparently the po knocked a hole in it causing drainage of ATF. I found him a used replacement online from a jeep jy. We put it in and he was off and running. He also couldn't put it in 4wd. When did the jeep will jerk like the axles had different gear ratios. That wasn't the problem it was a shot tcase.
"Its a Jeeps World, other 4x4s just get stuck in it."
My buddy had a bad tcase in his old yj. Apparently the po knocked a hole in it causing drainage of ATF.
I dont know if it was anything like that. I never have ha it leak any fluids until the rear diff. But i will know by monday whats wrong hopefully. If its bad im stuck with my cousins old 83 bmw. Ill tell you what i find out hopefully it can help someone else down the road.
Allright heres the news. It was a bad ujoint on the rear shaft on the differential side. And the transfer case wouldnt go into 4 wheel drive because aparently there was a carcass of a possum in the way of the shifter. Which explains the smell from several months ago. I guess when i was looking i was spending most of my time checking the rear, wish i wouldve noticed a dead possum on my tcase. Hope this helps somebody. Check those ujoints.
Man, I Diagnosed your problem on 10/24! When I took the U-joints out they just fell apart but when they were in the jeep they didn't look bad nor did thye have alot of play.
I know you did diagnose it but wen I took the shaft loose and messed with the rear joint it was still tight, but apparently the urethane bushings were super hard and were cracking. For a minute my mechanic was even unsure about if it was bad. Thanks for the advice guys!