At shop on lift, removed skid plates, and air tooled off the driver's side bushing bolt.
I thought that the washer may have had a collar below, but here is the pic of bolt.
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So after bolt was removed, this is what the bushing looks like:
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SO since we believed that overall the rubber was still in good condition, and only the top part of the seal was broken, it was time to re-install bolt at 120-ft. lbs.
Basically left it as is, and after torquing down, it is fine now. There is no more sideways movement, and the gasket squishing thing that was going on in the video, is also finished. Looks like for now all is well, but I plan sometime when an alignment is due, to replace both steering rack bushings anyways.
Does anyone know if any poly bushings exist for rack & pinion.?
Going to send off to energy suspension an inquiry.