I've seen parts diagrams of the 8 3/4" that show the pinion depth shims between the bearing cup and the housing OR between the bearing cone and the gear. It looks like both locations were used. Looking in the '70 FSM the shim is between the cup and housing. Anyone have any idea when the change occurred? I can see where the shim between the cup and the housing would allow easier changes but is there any advantage to being between the cone and gear? Thanks!

Easier to pull the bearing off the pinion and swap shims than banging that race in and out, especially after you've polished the pinion shaft to make the press fit of the bearing a little less tight.

I’ve asked Cass the same question and I believe he told me that the change was sometimes in the late 69 model year. It does not make any difference where you put them but I put mine back in the same spot that they are originally. I have a new setup bearing that I have honed to a slip fit and the Mark Williams setup tool. Setting is easy with no guesswork. It is easier to put them on the pinion. I’ve only had one that had Shim’s under the race.

Thanks, guys. I appreciate the help.

I don't think it matters where the shim is installed? Behind the bearing cup may be easier if you don't have a clam shell style bearing puller?
FWIW, the carrier bearing cup outside diameter is 3.2650", so the center is 1.6325" from the bottom if the bearing housing.
If the pinion depth, for example, is 2.721" below the axle centerline, the the pinion should be 1.0885" below the carrier bearing housing.
I tried a few different pinion setting tools, the universal pinion depth tool was a pain to use because the cap mating surface was not square to the pinion.
The Raytech gauge was a bit easier to use.
What I ended up using was a machinist 1-2-3 block on the pinion head, along with 0.088" if feeler gauges, and a machinist straight edge across the bottom of the carrier bearing caps.

I have a new bearing that I worked the inside diameter so it slips on the pinion without to much effort and it will come off without a puller. That way I use that bearing to set it up and get the depth shim it needs. Then once I get the right depth shim I will press a new bearing on the pinion and recheck it and its always came out the same since both are new bearings. But polishing the pinion also works as I hear many like to do that but I have not done it that way myself. Ron

1969 model year 489 castings originally came with pinion depth shims located under the race.

You can install Dana 60 pinion shims under the race of any 489 case to set the depth.

I prefer placing shims between the rear pinion bearing and pinion head to avoid altering the preload setting, however.