My S60 does exactly the same thing. It hunts for 1st gear and if you're not careful the engine revs and then suddenly engages with a big clunk/slam. This is not encouraging. My indie mechanic changed the fluid and updated the software. It changed nothing. He also told me that he's seen transmissions last quite a while with this. I did, however, purchase an extended warranty package in anticipation of the transmission not surviving the next 60K miles.