I have heard of this problem before and the fix was exactly as you mentioned. Grind a bit off each axle end, and be careful not to let the axle heat up too much. Go slow!
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Good luck!
Brad R.
1992 L.X. 5.0 coupe
MODS: A few little bolt ons 
New Best time ...11.60 @ 128 mph @ 2000+ ft altitude.
Rice Haters Club member #39
Users rides #2542
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