My Ls has a simple push in bushing. I think that there was trace remnant of some sort of fiber washer on the inside edge - probably placed there by the PO. I just put some of my "stickier" grease in the bushing to help reduce wear - I think that the recommended thing is to pull that off about once a year and clean out the crud and regrease it - do it more often if you're riding alot of dirt roads, etc.
Sounds like the O-rings ain't gonna fly. After fitting the new bronze bushing, if there's any excessive side-to-side movement of the shift lever I'll try some aluminum or copper washer shims.
Thanks for the input, folks. Justin, the tapered bearings sound very cool but I'm more of a "Big Chief tablet and #2 pencil" kinda guy. It's a BMW, right?

Now, how about some help with my aluminum cleaning chores?