Jorb,

Thanks for that info. I was thinking about Permatex getting into the trans also. The reason I was going to use Permatex is because a local transmission mechanic who works on Hydra-matics/Powerglides and torque tubes advised me the area has always been an issue as far as leaks. He uses "The Right Stuff" and has had good results, both on the seat to extension housing side and the shim side. I have made a thin paper gasket I was thinking of using between the seat and the extension housing to eliminate the Permatex issue and hopefully end the ATF drip.
I'll let you know what route I take.