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Roger,
When you say:
"I checked out the place you mentioned before I bought the pump. Their web price was (and is) $184 on a pump with no part number."
Do you mean "getvolvoparts.com (Tasca)? If so, I'll quit recommending them. That price quote above came from their website this morning.
WD40 is a great Water Dispersant but I don't think much of it as a lubricant. Seems like that seal, meant for a (fuel) environment, would handle most any common grease. But I also think dish detergent works well too.
Wish I could say which way is best—seal on tank or seal on sender. Looking at Art's pics again, his seal was still on the tank when the sender came out, as shown below:

A later pic (below) shows the seal on the sender prior to installing. But I don't know if that's how it actually went in. In any case, I think a good, slippery lube is the answer.
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Bruce Young '93 940-NA (current), 240s (one V8), 140s, 122s, since '63.
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