I'm satisfied now that the problem is inside the tranny and not just the kickdown cable or a flush. It's getting worse, not engaging into 3rd until warmed up for at least 4 km now. (It's at 267,000 km)
I have been quoted $1000 to $1200 (Can.) to buy and install a used tranny, with a 60 day warranty only. To rebuild the one I have, $2400 Can., for a 1 yr or 20,000km warranty. The dealer price for same is in the stratosphere.

I have to decide whether to
(1) dump the car as is (virtually no resale value) and rent a car at $800 per month while I shop for a new one.(leaning to Subaru Outback at the moment...)
(2) get the cheap used tranny because it is almost the same price as a car rental anyway, rely on the 60 day warranty while I shop for a replacement car, and I could at least resell the Volvo as functioning.
(3) get the rebuilt, better warranty work done and take more time shopping around, possibly get a better resale price.

Comments and opinions?