It seems that you might be experiencing the same problem that I did about a
year ago, especially seeing the fluid level past the max mark.

There are 2 seals in the back of the final drive where it attaches to the
transmission.  These back-to-back seals are used to prevent the gear
lubricant in the final drive from mixing with the ATF in the transmission
section.  When these seals begin to fail, gear lube is pulled into the
transmission and overfills it.  It also causes the transmission to shift
poorly.  In addition, you run the risk of destroying the final drive due to
lack of lubrication.  You should replace these seals immediately.

The transmission can be removed from the final drive with the final drive
and engine remaining in the vehicle.  I've only found the seals through the
dealer, but I'd bet that Ron at Bus Depot or Ken at VanAgain might have them
also.  I'd also replace the 4 O rings on the transmission cooler bolts at
the same time.

Good luck, and look at this soon.  Ring and pinion set are in excess of
$1100. and a used transmission/final drive is $550+ in this area.

Steve Sandlin
http://www.steveslockshop.com
'84 Wolfsburg Westy
'79 Transporter
'00 New Beetle
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