JMH,
My COE has a 2 speed rear axle also, and when I took everything apart, I had oil in my vacuum lines, too. My diaphragm was intact, so the oil was in the line that attaches to the inboard side of the diaphragm. The gear lube was getting past the worn seal that is in the shift cover. My seal had a number and I just took it to a truck parts place and they found me one. So, if you pull the flexible rubber lines that go from the steel vacuum lines at the rear to the shift cover (or pancake as you call it), you should find the source to your oil.
The other line was clean, because the diaphragm would have to be perforated for gear oil to get to the outboard side. I used to have a parts number for the rubber diaphragm itself, but can't locate it right now. You should be able to find the part number in the Old Chevy Manual web site. At the valve switch at the front of the truck, there was oil in all three lines,as the oil had crossed over from the switch. I don't think ultimately the oil itself would hurt anything, other than possibly lead to sluggish shifting from a vacuum leak back through the differential. You might get exhaust smoke if the oil made it to the intake manifold which would eventually happen if there was enough oil.
I only have a rolling chassis now, so it will be awhile before I start up the truck and see if I fixed the leak.
Good luck!
Kent
