Hey Jim,
There is lots of work that can be done...rebuilding the axle including replacing the wheel bearings, rubber mounts, rear brake flexible lines, new brake pads.. the list goes on.
My suggestion is do what you can afford and what needs to be done, keeping in mind that if you don't do it while you have the axle out eventually you will have to remove it again in the future.
If you can do the work yourself you will save lots of money on labour.
Upon advice from the MB service agent I had my rear axle rebuilt (bearings, rubber mounts etc) and drive shaft re-balanced with new flex joint and bearing, rubber mount, universal joints when all I really needed was the axle rubber mounting replaced.
The job went from about AUD $1500.00 to AUD $4500.00 very quickly.
If your axle is in relatively good condition maybe you won't need to do much at this time.
Bob Smith (Brisbane,Australia)
RHD,1967 early 250 SL, auto