WWYD? WHAT.............would you do?

I'd go with the AOD, keep it stock till it blows up. I think if you dont do a ton of full throttle downshifts, it will last longer than most people would expect. Theres a guy on another forum that was going like 6.70 or 80s with a stock AOD. Eighth mile obviously.
 
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Some info on T5's and alternatives....

A Tremec 3550/TKO/TKO 500/TKO 600 is a completely different transmission from a T5. Strong and almost bulletproof unless you run them without proper lubricant or full throttle shift without the clutch.

A Tremec T5 is still the same T5 that is prone to self destruction when used in a street/strip or racing environment

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T5, all versions used in 5.0 Mustangs

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Tremec 3550/TKO /TKO500/TKO600 AFTERMARKET replacement for T5 - handles racing environments with ease

See http://www.ttcautomotive.com/English/products/tremec.asp for more information - check out the "Light Duty" group, since TTC makes monster transmissions for big trucks as well as passenger cars.


T5 identifier information.

On the tail shaft of the transmission, there will be a stamped aluminum tag. The tag will have a number on it that you can cross reference to the chart below. There is no other way to find out what type of T5 it is without disassembling it. All the rest of the numbers on the outside of the T5 case are part numbers which are not unique to any particular T5 model.

Remember that 94 - 97 T5's have a longer input shaft and can only be used with a 94-95 bell housing unless you modify or replace the input shaft.

T5's used with a 4 cylinder have a 3.93 first gear, reduced torque ratings and an input shaft pilot diameter that is smaller that the T5 used for V6 & V8 engines. The Pilot diameter is .59" compared to the .668" used on V6 & V8 T5's. It requires a different pilot bearing to be used with a V6 or V8. The pilot bearing you need is for a Ford Ranger diesel from AutoZone part #14672


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I don't know how you feel about the DYI thing when it comes to gears, some people don't like the idea of working on transmissions. If the DYI transmission fix idea isn't something that you would rather leave to someone else, here are some resources:

See http://www.ttcautomotive.com/English/onlineorder/product.asp to download a FREE service manual for T5 or Tremec 3550/TKO
You will need the Adobe Acrobat viewer which is also a free download – http://get.adobe.com/reader/

See http://www.hanlonmotorsports.com/ or http://www.ddperformance.com for parts

A T5 rebuild kit with syncros, bearings and other small parts costs about $160. It does not include any gears or shafts.

http://www.hanlonmotorsports.com/ also has a video on how to rebuild your T5 or Tremec. It costs about $20, and is worth every penny of it.

I did a Tremec 3550 rebuild, and it wasn't that difficult. The video was an immense help, and I would recommend viewing it. At $20, it will give you an opportunity to look and decide for yourself if you think that it is something you want to try to do.


T5 Shim kits – best product I have seen in a while… http://www.5speeds.com/t5/shims.html
“The Peel ‘n Place T5 World Class shim kit makes shimming T5 counter gear and main drive gears very easy.”
 
Jrichker is pushing the old 3550 huh? I like mine. It's been upgraded to TKO specs with the "pro shifted" package, so I have no basis for a factory pro/con estimate. It's either going auto or T-56 Magnum when I build the Dart motor.

Glad I could help on the adapter. I used to have a large folder of info for the 2.3 conversions. The (theturboforums.com) site used to have some good info, but I am still trying to find the site I pulled alot of the technical information from.
 
I appreciate the input from everyone. I'll use the AOD that comes behind the TC engine. I will do whatever needs to be done to bolster the durability (to include upgrading the entire AOD to V8 size) after I get the combination running at targeted power.
 
I'd go with the AOD, keep it stock till it blows up. I think if you dont do a ton of full throttle downshifts, it will last longer than most people would expect. Theres a guy on another forum that was going like 6.70 or 80s with a stock AOD. Eighth mile obviously.

Yeah,..I agree. Especially since I do not intend for the car to ever see a sticky tire, and/or a drag strip launch pad.