4000S automatic trans questions

[Dave]

I have an '87 4000S with 4 cylinder and a bad automatic trans.
The engine runs OK but the car doesn't move.  I found a lot 
of ATF on the underside of the car and one of the pan bolts 
on the trans was loose so I suspect the DPO ran it dry.  I 
drained the trans and found that the ATF contained a large 
amount of gear grease.  I wouldn't rule out the possibility 
that the DPO put gear grease in the trans, but I have found 
from scanning the archives that failed seals can cause the 
ATF and hypoid grease to mix.  There were some metal filings 
in the pan but not as many as I expected, given that the 
car doesn't move at all and there is a definite sound of 
something in there slipping.  The parking pawl doesn't 
engage so that may account for part of the scrap metal.

Assuming that the trans was run dry, could it have damaged 
the torque converter?  How do you tell?  The Bentley shows 
a governor on the side of the final drive unit.  Is this 
likely to be fried?  Would running it low on ATF cause the 
seals between the trans and final drive to fail?  Would the 
gear grease gunk up the filter to the point that there is 
not enough pressure to engage the transmission?  I am in 
the process of removing the whole unit and will tear into 
it when I get it on the ground.  And yes, I got a h*** of 
a deal on the car.
Thanks,
Dave