It looks to me like there's a lot of wear on the side (bigger) gear teeth, and on the differential pinion (smaller, or "spider") gear teeth too. Due to the tapered shape, as they wear, the pinions can move toward the center. Movement of the side gears may be limited by the pinion shaft (cross pin) or the center axle spacer. It also looks like the spacer has been moving on the pin. The only way that can happen is for the pin to be loose in the case, or the side gears are moving in the case, taking the axles and spacer with them. For this to happen, there must be a lot of wear on the side gears where they ride in the case, and also in the holes in the case where the side gears run. Gravity is taking up the play between the lower pinion and side gears by pulling the side gears toward the pinion.
There's been a lot of wheel-spin going on here, I'll betcha.
Now, to avoid confusion, even tho I've tried to use the proper terms, everywhere I've written "pinion", say "spider".

BW