[ZeGermanHam]

I went through a similar decision making process with my '66 a few years ago. The car came to me with a worn out Olds "Type O" rear end, but mine had the more desirable 31-spline 3.91 posi setup. It whined terribly under deceleration. I set up an account on ClassicOldsmobile.com and got connected with someone who rebuilds the Type O rear ends for a living (username: Monzaz) to inquire about its value. He said as a core in its current state needing rebuild, it was worth $500. To fully rebuild it would add up and ultimately be less durable than other non-original options (Quick Performance 9" or Strange S60). Anyway, my crusty worn out Type O rear end was quickly snapped up for $500 by a ClassicOlds forum member, so I was happy to see it be saved from being discarded as scrap. Had a bomb-proof Quick Performance 9" built for ~$2500. It's awesome.

I share the opinion of not reusing your Type O rear end in your '66. Find and Oldsmobile guy who wants it and have something else built to your specifications.