Differential oil leak

[wcm3@domain.elided (William C. Macfarland)]

Help! While taking the drive shaft out of my '77 Spider this weekend, I noticed
gear oil dripping out of the differential. Its coming out of the front of the
differential where the drive shaft connects. In looking at my shop manual, 
there is indeed an oil seal that can be replaced. However, a search of the 
Italian-Cars-Digest archive indicates that a "collapsable spacer" could be 
involved. What is this thing? Is replacing the differential oil seal a 
do-it-yourself job?

Mr. James Seabolt had discussed a "pinion seal." Is this what I need to 
replace. It lookes from James' description that I would need to be careful
about replacing the "big nut that holds everything in place." James, do you
have anymore information on this procedure.

By the way, my car has the pre-'78 differential, complete with cob-webs.

Dismayed in NC,
'77 Spider