Volvo Repair: 2000 V70 Dealer blew ECM, immaculate service, trans fluid

Question
THE LONG STORY: Took my 2000 V70 with an immaculate service record to dealer because of hesitating/surging. I new there was a recall on the throttle but they said they had to clean it first since there were no codes. They cleaned it and it did the same thing and actually broke down on my wife. Took it back and they performed throttle recall. When installing the new ETM the computer locked up and they blew the cars ECM. Volvo paid to replace the ECM. Went to pick up car and Service engine light was on. Left it in the lot and was called the next day and was told the O2 sensor was bad. They told me it was unrelated and just a coincidence. I paid for the O2 sensor. Dealer told me that they drove the car for 14 miles after the O2 sensor was replaced and that no Service Engine light came on. They also advised that the transmission seemed to be slipping a little intermittently. The transmission never slipped before I took it to them. I picked the car up and got 2 miles from the dealership when the car couldn't find the right gear and the trans was shifting all over the place. The car was completely undrivable and unsafe. The overdrive arrow started to blink and the service engine light came on. I took it immediately back and was told that a TCM lock code came up. I was assured that they would do the right thing and to call the service manager on Monday. The service manager stated that the TCM locked up and the car would need a new transmission. He stated that it was not related to the ECM they blew up and that he smelled burnt transmission fluid on the dipstick. He said he drove the car again even thought the service engine light was on and that he thought we could get the car home and was drivable. He also stated that he noticed the trans (slipping) after he replaced the O2 sensor and checked the trans fluid and it was full. They are washing their hands of the entire thing. THE QUESTION: How long does it take for trans fluid to smell burnt? Service Manager said it takes a while. Could the ECM blowing out have effected the TCM, would that start burning the fluid and could that have done this to my transmission? They said they don't diagnose the trans, they just replace them so there is a good chance that the TCM is the only problem. I can buy the O2 sensor since they can really go anytime, but the transmission is hard to swallow. The car has a perfect service history with every service stamped in the book. It was exibiting no signs of a trans problem at all, just the surging and stumbling which was related to the throttle recall. Unfortunately, I don't trust this dealer. I have caught them in a few lies already by being alert and I am at a loss on what to do. Please, anybody, help if you can. I am also going to try Volvo to see if I can get anywhere with them.
As of this time, the service manager is stating that the car isn't that bad and we can take it home even though the service engine light is on, the overdrive arrow is blinking and the car won't shift into gear.  

Answer
it is possible that you have problem after software upgrade if the dealer did not use proper procedures   using  correct battery   charger and hook up   but to prove that is almost impossible fluid will smell burned there is not interval on transmission  fluid change  for normal driving but  i need your fault codes  first what you have now did you scan it by dealer do you have it the codes dtc? how many miles do you have? you can tray to do one more software upgrade to see if it helps before replacing transmission go to dealer tell them  you like to do total can software  upgrade if that don't help than let me know what fault codes you get after that  but give me  also fault codes if you have any  now . if you have problems before surging and stumbling it is possible you had problem in transmission but you were not able to feel until recall fix the idle and surge now after upgrade computer checks all operations and if it sees something wrong that will effect emission it will go in safe mode and give you many problem driving it not much that you can do about that until is fixed right way