has anyone experienced water entering their differential ???

Usually the first thing I do with any off-road vehicle is extend all the vent lines as high as you can. It is cheap issurance for this problem. Mine are all run about half way up the roll cage. If the diff isn't leaking oil the water has to come in throught the vent. But to answer your question, Yes, I have had water in just about all my toys in at least one of the gear boxes.

I had the same problem with my rear diff. The 2 seals where shot.

After thinking about this post I wanted to add a little to it. Any gear box will get hot, the case and oil will expand, hence the necessity for a vent. If your vent becomes plugged you will push out your seals if it expands enough, something that has happened way more than once!! If your vent line is exposed to water while the case is cooling it will suck water as the case and oil contracts. An example: You are cruzin down the trail and all your boxes are hot from being used. The case and oil is expanded to it's limits. You now dive into a cool mountain stream that the trail crosses. Your vent line went into the water and your case and oil is going into contraction overload from being exposed to the ice cool water. You just sucked water in! If you want to see it there is a simple trick to see just how much a case needs to vent. Put a ballon over the vent line sealed up tight with a little air in it. Go ride and watch the ballon blow up. Stop and let it cool and watch the ballon shrink. Some older Suzuki ATV's actually used a similar system to keep the water out of the cases. Just a little info I wanted to add.

hey thanks for the reply since my post i have extended the line and looped it seems to have solved the problem