8.8 axle shaft o-ring
 

Does anyone know the purpose of the O-ring on the end of the axle shaft in the groove where the C-clip goes? Also, what side of it should the C-clip be installed? In all the literature I've seen don't recall it being mentioned except in one video and it didn't specify what side.

I'm not sure of the purpose, probably to help keep too much oil from the pumpkin from getting into the axle tube from cornering (WAG). C-clips go on the inboard side of the axle shaft.