When you weld the rear spiders, you call it a lincoln locker.
Keep in mind that if you weld the spiders, you also need to weld them to the carrier.
Mini-spools just replace the spiders, so you can pull it and go back to stock. A full spool replaces the whole carrier.
From personal experience, I'd say that running MT tires on the street is better. They don't grab the pavement as much as ATs will, making less noise, hopping less (the rear end will bounce because the tires are dragging), and tightening the steering radius.
Offroad, you'll notice the difference right away, and there's really no downfalls.
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