Axle seals are done so I am going to check the breather. It's a 2001 4wd. However I am unclear what I am looking for when I remove it. Do I make sure air can exit the breather or exit/intake ? Basically how do I know if the breather is good?

 

Take the breather out of the axle housing and try to blow through it. If you can, it's good. If you can't, or it's difficult, it's shot. When I did the breather extension, I picked up a new one from the dealership, it was about $6. If after taking it off and checking it, you're still not sure, replace it. Much cheaper and easier than doing the axle seals again.