If all the oil comes out just put some grease in there. You kind of have to stuff it in the hole on top with a little paddle. That will do fine, and many people do it.
To adjust play loosen the nut on top and move the bolt type thing in the middle of it. You'll need and an adjustable cresent wrench and a fairly large screwdriver. To take out play loosen nut, turn bolt thing clockwise and then tighten nut again. I'd start with 1/4 turn of the bolt thing and then try that. You may have to adjust it a few times until you get it how you like it. I had mine too tight (too little play) for a while and I think I was a menace when driving on the freeway.
I think your mechanic is wrong. These steering boxes are rock solid. If it doesn't respond to an adustment then you do need to rebuild, or find another. The leaking of oil is its worse feature, which is why folks go to grease.
Yes, the 122 box is interchangable.