With the driveshaft pulled you should be able to replace the output shaft seal easily enough. I'd bet a dollar to you dime thats where your leak is at. Most of the experiences I've had with the 3 speeds is that they are bullet proof as long as they are driven with some sense and not made to reach warp speed.
Tramp


dj durant

1964 Chevrolet C-10 Pickup Truck
In the Stovebolt Gallery
More pix on Flickr