Possibly a piston in the brake caliper seized up. Like the Toy mentioned. If it's only one wheel.
But you shouldn't be able to move it even a fraction of an inch.
Since you said the wheel would move ever so slightly, it almost sounds like the "play" between the ring and pinion.
I'm not trying to scare ya, and I'm only speculating here, but if it does have something to do with the differential, and since we don't have limited slip, one wheel could be locked up, while the other spins free.
I still think it's brake related.