This is what Randy had to say about spools in the welding rear end gears thread.
I weld all of my gears for personal use and those I sell with a MIG. I use an anti-splatter spray throughtout the interior of the housing to prevent slag from sticking to the gears or bearings. I weld the eight corners of the spider gears, along with the side gear that is exposed to the side of the carrier. Make sure that you attach your ground lead directly to the ring gear. If you attach it anywhere else, you are runing the circuit through the bearing(s) which will ruin them. You can by the anti-splatter spray at a welding shop; the can I have is made by Randor and is product #64000100.
And finally, the spool is not the way to go. If you gave me a free lifetime supply of them, I would only use them for paperweights. I have personally had three spools strip, and have had many customers have the same problem. The spools are not heat treated as well as the Toyota spider gears, and the spool gets really sloppy. If you have a spool, check the slop in the splines from side to side, when they are new they are tight. If your spool has alot of play in wheel travel from side to side, it might be time to get another one.
Randy - RPM
I have heard similar claims on the dwarf car boards.
fwiw,
Steve