OK guys...thought I'd give you an update. I knew that the Watts linkages was worn and due to be replaced. Part of me hoped that this would sort out the problem but the sensible part told me 'no'. Sensible part was right.
Rear diff just been replaced. I saw the old one and they congratulated me on still managing to keep driving the Disco as they'd never seen a diff as bad. There is a thick pin in the middle...maybe two (I'm not an engineer as you can gather) ...that was broken. The two holes that it located in at either end had worn into elongated ovals...almost half as much as the radius at each end. Forgot to take a photo.
Anyway, no clangs. Thanks for all the other suggestions.
Oh yes, the bad news was that one of the rear hubs was seized on and they had to virtually destroy it to get it off....that cost almost as much as the replacement diff.