There is more than one way to skin a cat, and build a differential. When assembling a quality road or race differential, selecting the right components is essential. All components must be of the highest grade and equal to or better than OEM components. In some cases Diff Lab has designed and produced Australian made products to fill gaps in the supply of the best components.
Diff Lab sources only genuine seals from Germany from manufacturers including Kaco, Victor Reinz and Corteco. Cheap locally available seals are not used in any Diff Lab differentials. Diff Lab tried to make these locally available seals work, but after a dozen reported oil leaks, it was clear that there is just no way to make them work properly. The local market is flooded with Chinese products which are inferior to OEM items. There is no seal available from any local bearing or automotive store which is equal to a top quality European seal which is OEM fitment to a BMW. Compare the image of a genuine seal and a locally available Chinese made seal below.
The seal on the left is a genuine seal. Genuine seals are made by a range of manufacturers, mostly based in Germany and France. The Chinese seal on the right, in this case a NAK from a local bearing shop, is a loose fit. It is easy to press into place and may not stay there. The genuine seal is difficult to press into place. It has ribs on the outer rubber which hold it in place very effectively. It fits tightly and will not move or leak. This CAD image below of a Kaco seal (an OEM supplier to BMW) demonstrates the design of this type of radial shaft seal. It has double outer seals (dust) and an extended dust seal which mates with the metal dust cover on the input or output flange. The geometry on the genuine seal is optimised for the best possible seal and maximum longevity. The materials used in their construction are exceptional.
The genuine seal has three dust seals. It has two dust seals on the input/output shaft, and one which is is designed to work with the steel dust covers. These three seals work together as three lines of defence for the inner oil seal. Notice how the spring sites just to the outside of the main oil seal. This is good design, and provides the optimum oil seal. It is not uncommon for genuine seals to last 100,000Ks or more. The Chinese seal will not last even one race meeting in many cases.
There are three main manufacturers chosen to supply bearings to BMW, though there are many other high quality bearing manufacturers. Historically OEM bearings were SKF (Germany), FAG (Germany) and Koyo (Japan). Timken (USA) and National NTN (Japan) are acceptable substitutes. Modern BMW differentials are usually fitted with Koyo and FAG. Diff Lab mostly stocks Koyo, FAG and SKF. No good quality OEM-grade bearing is generally better than any other. Though where the design of a bearing has been revised and improved, for example 188L/LW Koyo, they may have improved longevity. Talk of some brand of OEM-grade bearing being better than some other OEM-grade bearing is nonsense. If you take old FAG bearings out of an E46 M3 diff and replace it with Koyo or SKF- that is totally fine.
Good quality bearings which are installed correctly should last for the life of the vehicle (ball bearings may not). It is a lack of oil changes which causes the most bearing damage. When differential oil becomes old, it contains excessive metallic particles, and its viscocity becomes thin and unstable. It can no longer lubricate and protect the bearings. In a differential with very old oil, there is usually a metallic sludge build-up in the bottom of the diff housing, and in the pinion oil passages. It gets stuck inside the LSD too. Lifetime differential fluid is not supported by Diff lab. All late model differentials require regular oil changes. There is no drain plug in modern differentials, so in many cases the technician can pump the old oil out with a suction tube. The bearings in the late model ball-bearing differentials often fail prematurely. These need regular changes of differential oil for maximum longevity.