so it is leaking out of where ?? do you have too much fluid in the transmission ??
the o-ring goes on the torque tube housing ? not many seals in the transmission originally
here is a posting about replacing that: which requires some work and was originally cork !!
Replacing the cork in the ball housing on a 29if it is leaking bad out hte back of the transmission then may want to look at bearing and such
1929 Transmission Check/Rebuild this is when i rebuilt my transmission completely so you can see how it comes apart and goes back toether.