How much fluid leaked out? Was the torque converter drained too? If not, probably over filled and fluid is coming out. If the pan was not torqued correctly thee may be leakage from gasket gap. If pan was torqued too much, gasket split and pan is warped causing leakage. Flaring could be from the loss of fluid or too much fluid (creating foam I think). Maybe someone else can chime in and offer some advice.

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1990 190E 3.0L