If the oil leak is at the front, under the radiator, it

may be oil leaking from the intercooler. This is normal.

Oil can accumulate in the intercooler since some oil is

always drawn past the turbo bearings and gets into the

intake charge. There is a small hole at the bottom of the

intercooler where oil is blown out when the turbo is

creating boost. You can easily check this by dropping the

front platsic cowl (two 10mm bolts on either side) and

look at the inside bottom of the cowl. Some cars drip a

bit more then others.

This site has many common service procedures (including

tranny flush) documented with instructions and photos:

http://volvospeed.com/bay13.htm

> a tiny oil leak from under the car the source of which is yet to be

> determined.

THIS is typical.

to change and to flush it they just keeping draining,

> refilling, and running the car over and over until its clean. Is that

> the way its supposed to be done?

YES. Standard operating procedure. There must be SOME sort of screen in there, though.

> Is the turbo water cooled , oil cooled, or both? Would adding a turbo

> timer benefit me?

YOU can't do a turbo timer because of the alarm system. Turbo is water cooled, and oil lubricated/cooled. I suggest you switch to synthetic. When you bring the car in for the T-belt, you might ask if an Amsoil-type engine flush would make sense in your case. You didn't say how many miles are on the car.