Glad you found those worn splines before you encountered a "no-go" situation. Mine was not pleasant and ruined a perfectly good day of bringing a new PWC home. They don't hold up well on the 3.0 engine either!

2002 X5 3.0 243,000 miles
2004 325i 108,000 miles

Here are some links to pics of the removal and disassembly. The aft bearing is noisy so it is on order from Cobra.
image | Flickr - Photo Sharing!
image | Flickr - Photo Sharing!image | Flickr - Photo Sharing!image | Flickr - Photo Sharing!image | Flickr - Photo Sharing!

If it's not too much trouble a parts list and cost breakdown would be appreciated!

So far I've needed:

front shaft $600+
front rag joint $120
output shaft bearing $30
chain $80

I had to buy a 3 jaw puller, though I could have rented one from Autozone.

Which part did ya chuck at the airplane. :D

Thanks Seth. Good luck with the rest.

+1 on Cobra Trans. If you check e-bay they usually have rebuild kits at a discount.

Here is the latest. Assembled the case. You cannot do this without a three jaw puller in my opinion! An impact wrench is definitely necessary too.
transfer case 002 | Flickr - Photo Sharing!
transfer case 001 | Flickr - Photo Sharing!

Nice work.

I have almost 40k on the CT chain replacement job I did in '11 on my (then new to me) '03, it's a solid part so far. That was after driving the X 500 miles home from buying it without a drop of oil in the tcase (unbeknownst to me). Mine needed only a chain and a lot of cleaning, the rest of that case is bulletproof.

I threw spacers on the front driveshaft at the same time (and lubricated the heck out of the splines) to help prevent that awful driveshaft wear.

Well I got it all put back together after a little setback. The new longer driveshaft is about a 1/4 inch too long to install if the transfer case is installed onto the transmission. I jacked with it for awhile and finally cut a 1/4 inch off the new shaft. It is still over an inch longer than the original and works fine.

I drove it around and flogged it pretty hard and the popping is gone!

There is still a whurring noise coming from somewhere up front. I have no idea where. It sounds like it could be coming from the front differential or something.