Tractor Repair: Craftsman Automatic Transmission Leaking, transmission pulley, pvc type


Question
I have a 1999 Craftsman 19.5 HP automatic lawn tractor that has developed a leak in the transmission.  I threw a drive belt which in turn tore an engine pulley, exploded a clutch pulley and bent the bellcranck clutch ground drive stl.  I ordered and replaced all those items and was tickled pink to get the tractor back on the road so to speak.  I went out into the yard to give it a test drive and after a few passes took it back in the garage to see how things were.  As I was backing in I noticed a heavy drip of oil coming from underneath the tractor.  I thought that the seal to the transmission pulley was leaking as the previously thrown belt had wrapped itself under the transmission pulley.  Instead, there is a 3 to 4 inch rubber hose rising vertically out of the top of the transmission with a plastic valve on top of it where transmission fluid is bubbling out of the top of it.  I don't know if this is a check valve, or a pvc-type of valve or what it is because my exploded view diagrams don't show it!
I called Sears and it is $90 for the guy to come out and the lady who took my call said that they don't service the transmissions as they send them away.  New is $600.
I've looked on a few other boards and one guy said to drill a hole in the bottom of the transmission, drain it and put a sheet screw back in the hole and refill with tractor oil.
My neighbor suggested to go to a small engine shop and see if they have a replacement valve.  (White with a black nipple on it that fits on top of the hose).
The transmission is a sealed type that has a set of purging instructions that one should follow upon servicing the transmission or when it is first pulled off of the shipping crate.  But it's not so sealed that I can pull that hose off and let all kinds of air in as I'm trying to figure out what kind of valve I've got or what the heck is going on?  
Anyways, I'd appreciate any thoughts that you might have on my problem.  Some of my own are that the new belt has put new torque on the transmission.  Water is in the transmission and that's heating first, (transmission is not hot to the touch, just warm).  I put things together wrong hence the new torque level, (how can it cut grass and drive if I did?).
Thank you.  

Answer
The tube is a vent for thermal expansion - the cap allows air / heat out and prevent dirt from comming in ---- if the cap fails and allows water in then I would say replace it --- drain the trans - check the fluid for contamination -


Fluid will usually boil out of a transmission if it is contaminated - over filled - or the filter / valve body is plugged up --- if the trans works properly - then I doubt you have it together wrong.  

Start with the fluid -