In reply to Got a job rob:
If its noticably worse than it was, take off the casette and have a look at the hub carrier... has it got grooves where the cassette has worn the hub carrier? Remove the hub and clean and re grease the pawls, inspect the springs to check they are moving the pawls correctly. Also check and clean the rack that the pawls run on.
There will always be a bit of slack, but it shouldnt be noticeable. Xt hubs are decent, so I wouldnt expect a big difference from an upgrade, and remember more engagement points means smaller engagement points which are more likely to fail if gunked up with mud etc.