"The sheer amount of caches we've found would stun you," said marine Lieutenant Colonel Dan Wilson on Wednesday.

"You could literally take over this country with the number of weapons we've found" in Fallujah.

Marine combat engineers and explosives experts Wednesday were again scouring homes amid the battered streets in south Fallujah's Shuhada district, where the day before gunmen traded shots with units trying to seize two homes that were later found to be hiding nearly 700 mortar shells.

"We knew south Fallujah was a pretty good strong point (for the rebels)," said Staff Sergeant Tim Oberst of the 1st Battalion 8th Marines as he stood down the street from the two houses, where he said rebel "stragglers" who still wanted to fight had lain in wait for troops to pass through the neighborhood Tuesday.

"They had weapons stacked up like they knew what they were doing. If they had enough people who knew how to use this stuff it could have been a lot worse, but they were definitely ready. They wanted to fight."

On November 8, US troops backed by Iraqi government forces launched the largest post-Saddam military operation in Iraq in a bid to reclaim lawless enclaves across the country ahead of the January elections.

At least 1,200 insurgents are estimated to have died in the fighting, which drove most of Fallujah's estimated 300,000 residents from the city.

On Wednesday several columns of black smoke hung heavily over the ruined buildings, most shot through with shell holes and others entirely collapsed amid vast pools of stagnant water and trash-strewn razor wire.

But as US troops largely cleared the city of rebels this week, reducing the insurgency to what military officials say are a few isolated pockets of fighters harassing troops with sniper fire and booby-traps, the extent of the rebels' preparations was becoming alarmingly clear.

For more than an hour Wednesday a daisy chain of marines passed mortar shells -- from 60 millimeter rounds the size of a small water bottle to large 120 millimeter mortars and artillery shells that had to carried in both hands -- to a waiting truck as a convoy of vehicles snaked its way through one ruined neighborhood cleaning out weapons caches.

Elsewhere, an AFP correspondent saw a captured arsenal laid out in the dirt on the edges of another neighborhood: rockets and antiquated shotguns jumbled next to clean, well oiled assault rifles, heavy machine guns and several homemade bombs.

Outside one house, marines piled boxes of medical bandages, IV bags, saline solution and other medical supplies they say had been stockpiled before the assault before torching the home where the cache had been discovered.

"These guys were prepared -- medical supplies, food that would last forever," said Lieutenant David J Lee, adding though that brutal artillery barrages before the assault had succeeded in destroying the insurgents' commanders.

"Once they did that it was just a fight with a bunch of disorganized guys, and a lot of them didn't know how to use this stuff.

"But don't get me wrong, it was tough. But it could have been a lot worse."

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