For the sake of completeness i thought i would update here. I decided that vitara housing would be the way to go. But i wasnt confident in the process so i decided to do some test runs.
I got hold of some old NT housings and set about cutting them up. These will get used on a future project as they turned out awesomely.
i bought a length of 30mm solid bar and some offcuts of alloy round bar.
we have an old lathe that we used to machine up some spacers to fit in the ends of the bearing housings.
basically you put all the bits together and start tacking. making sure the bar turns smoothly after each tack. and then weld between the tacks still turning the bar.
its only minute amounts out of straight befor the bar goes tight so i know the housing is near perfect.
end result i have nicely straight centred diffs.

next will be the vit diffs now that i know this method is so good.