That was my suspicion as well however, if you remove the Front Drive Axle cone-shaped cover exposing the center shaft and all that grease on it you will notice that the inside of the cover is clean and has no grease protruding that far inside the cover.

So I did some investigating and went to my local junk yard. All the Rodeos and Troopers they had the same covers as the Vx. One of the Troopers did have a flat cover and looked to have plenty of room inside for the Center Shaft.

As far as the grease is concerned, I don't think that it requires a whole lot of room for expansion/contraction - which I don't think it does whole lot either. The shaft assembly doesn't have any side-to-side play that would require clearance allotted should the center shaft protrude further into the cover so that's not it.

In other words, I don't think having flat axle covers would render grease ineffective or cause some kind of rubbing/grinding by the axle center shaft... so why didn't they use the flat covers then?

P.S. The reason I'm asking is because I do happen to have a flat cover that I'd like to put on as my new wheels leave that part exposed and quite honestly... it just looks... wrong...