Back in '99 I picked up a 240 with 42K on it. The tranny fluid was slightly burnt. I took it to a shop and had the fluid replaced. 6 months later it was looking burnt again. I then fully flushed the fluid myself. Again, 6 months later it was looking burnt. Even so, the transmission was still working just fine. I then, once again, flushed the system. Only this time I used a Synthetic ATF. No more burning. I had put in Mobil 1 ATF. After trying Amsoil ATF in my other car and being shocked at the difference, I dumped the still nice and red Mobil 1 ATF after 23K and replaced it with Amsoil. The Amsoil has been in there for almost 20K now...still nice and red.

I hope that this is encouraging for you. You would do well to flush the system with either Mobil 1 ATF or Amsoil ATF. This may solve your fluid problem. Both are excellent. I found the Amsoil to result in a little smoother operating and a little better fuel efficiency.

-Ted