8 3/4 Sure grip question

I have a 489 case sure grip and I have a body axles with rp400 bearing(green) on them. Of coarse this does away with the axle adjuster. My question is do I have to remove the spacer in the middle of my posi unit to make sure the axles fit in all the way. If I look in the axle shaft hole of the posi unit I see the spacer and my friend have a sure grip also but he does not have the spacer in his and he ran rp400 bearings. Help much appreciated.