Yes to the thinner pinion shim - a bunch. At least .004 thinner and see how it goes from there.
I'll give a brief (yeah right) description of how I setup a set of gears.
1st - determine how much shim is needed on the carrier for zero side to side movement. This is most easily done by setting it up a minor bit loose, say .002-.004", and then adding the exact amount of the looseness and confirming that you have zero end play when that number is installed. And you want zero to -.001 of end play. No more, no less. Measuring the factory shims that came out is usually right where you need to be if using a good set of new races and bearings. Once you know this, then take out .002 to .004" so that the carrier goes in and out easily when checking the pattern - I prefer .002"
2nd - make a setup bearing for the inner pinion bearing - SAME brand as the final brand of bearing you'll be using. If you don't know how to make this bearing fit properly, then say so.
3rd - find the original pinion shim and measure it. Don't trust a number on it, make sure you know the exact dimension of it.
4th - get a pad and make a column for pinion shim, gear lash, left carrier shim, right carrier shim, and result.
Trial and error time :
5th - install the original pinion shim with the setup bearing and original carrier bearing shims (if close to zero side play) and check.
6th-20th - lather rinse repeat until the drive side is perfect. If the coast side is terrible when the drive side is perfect, then move the pinion .001 in one direction and adjust the gear lash according until the coast side is OK.
7th-21st - install the correct carrier shims for zero to -.001" end play and recheck - this needs to be spot on as this is the last chance at adjusting the pinion.
8th-22nd - install the final inner pinion bearing and slap it all together and look at it crosseyed once or twice, then recheck the pattern. It'll be great.
Do not get tangled up in super tight backlash, .012" is fine and anything closer than .008" is risking making a whiner in the back seat. The drive side pattern is of ultimate importance, unless you plan to drive in reverse most of the time. Lastly and most importantly, patience is a virtue with this. I've put them together with perfect patterns on both sides on the 1st whack (rarely), but it happens. I've also had them take 20+ 'apart and back together' before I felt OK. Make sure the ring gear is seated completely and correctly as well. Good luck - Jim.
