What would be considered an acceptible amount of rear axle/differential play?

My test with the transmission in Park, parking brake off, is to put one rear wheel in the air and try rotating it. Before I get any movement in the differential drive flange, I get about 1/2 to 3/4" of rotation in the rear wheel, measured at the outside circumference of the tire tread. At the point where the differential drive flange does start rotating, there seems to be very little further play, so I believe that everything from the U-joints forward is good.

I believe this play in the rear axle is responsible for the clunking I'm getting when I begin gently accelerating from a stop, especially when reversing directions. I'm not sure it's worth replacing the rear axle (I'd go the wrecker route if I did this); is there any serious problems with just driving it the way it is?