There is a decent chance your mechanic is a perceptive fellow and knows the bills to deal with this problem at his level are not practical. On the otherhand between yourself and a good knowledgeable shade tree mechanic on ocassion you could perhaps handle this.

First you have to find out if the transmission really needs replacement yourself. Using this site and the archives. You do have some major advantages like you know the indicated milage is correct unless your father remembers any period of odometer failure.

It seems to me that a solid replacement engine and transmission known to be really good out of a wreck might be a cheap enough option. Members like Brian are also completly right. Unless you get directly involved and control costs including Major part aquisition it is not really practical.

In your case there is some personal sentimental value in the car having been in your family since new. If not pushed for storage space and time or need you might want to take some time to really think this through before deciding on a course of action.

Much depends on any residual atachment to this car from a family perspective. I for example would like to have one of my fathers cars to bring back over time.

Also depending on your age and experience in life you might learn some real scrounging abilities as well. There are a few cars that I regret selling over my lifetime. Changing your mind after it is gone is usually not workable. Remember that you do have a rust free body so you are far from starting with nothing.