Thanks Ernie. I hate it when you follow a problem and once the solution is found it is not posted. Then no one except the person experiencing the problem knows the solution. Speaking of solution, I haven't really decided on a perminant fix as of yet. I just put a couple of hose clamps on the sway bar to limit its free movement. Not real sophisticated but it is working for the moment.
Thanks for the feedback SCOBRAC, but if you where addressing the problem I was having, it is definiatly the spherical rod end hardware hitting the halfshafts. The knuckle was 'polished' smooth and part of the bolt head worn away. Speaking of lube, I went through the selection process and ended up using Moroso Climbing gear
oil along with two tubes of the GM limited slip additive. One thing I found of interest during my research is an article about 'tuning' the limited slip with the additive. The article suggested that you add the additive in small increments until the unit worked smoothly and then add no more. This as opposed to just adding 8oz. blindly. I didn't take the time to do it but it was of interest.
Rick