I had to have the front transfer case replaced when it sounded like that. I also have a 2005 V70R. It went at 120K or so.
It was the bearing.

I spent $9,500 on my 2011 XC60 T6 with about 100K miles. In about 30K miles the only non maintenance issue has been a battery and a CV boot. Other than that I had the belt replaced and did the ordinary oil and filters myself. Great car, 300 HP, I would buy another one.

When I bought my V70R in 2017, I has to replace the bolt because it was missing on one of the front wheels. i must have driven 400 to 500 miles before I noticed. I saw no ill effects.

I bought my 05 V70R in 2017, it had 101K miles.I was getting surges at down shift gear changes. I do a drain and fill of about 3 quarts at every 5000 mile oil change. It is now at 159 K miles and I would say the shift surges have gotten better. The fluid no longer looks burnt. That would be my recom...

I have pulled the front seats on my V70, V70R, C30 and XC60 and always disconnect the battery first, never had a problem after putting the seat back in and reconnecting the battery.