My transmission fluid is has to be changed and what kind of transmission gasket do I need and how much fluid do I need

All you have to do is go to Wal Mart &
read the back of the trans fluid bottles

YOU COULD HAVE FAULTY TRANSMISSION NEUTRAL SAFETY SWITCH BUT CHECK TRANSMISSION FLUID LEVEL MAKE SURE NOT LOW .IF ITS BEEN A LONG TIME. CHANGE TRANSMISSION FLUID AND FILTER.TRANSMISSION NEED MORE FLUID IN REVERSE BECAUSE NEED HIGHER FLUID PRESSURE TO APPLY REVERSE CLUTCH AND GEARS.

You may consider getting the fluid from a Volvo dealership in the parts department.
Volvo is supposed to have special conditioners in there transmission fluid that are vital to the long term performance of the transmission.

I hope this helps.

CHECK TRANSMISSION FLUID.IF LOOKS BLACK HAS A BURNT SMELL .CHANGE FLUID + FILTER.IF FLUID CHANGE DONT HELP.YOUR SHIFT VALVES IN VALVE BODY STUCK OR SHIFT CABLE NEED ADJUSTING.WHEN YOU DO A FLUID CHANGE YOU CAN BUY A BOTTLE OF TRANSMISSION CONDITIONER IT FREE STUCK SHIFT VALVES IN VALVE BODY.I WOULD ADD 1/2 OF IT WITH NEW TRANSMISSION FLUID.DONT OVER FILL TRANSMISSION WHEN YOU ADD IT IN.

dextron III transmission fluid

There no tranny drain plug, you must drop the pan to change the fluid and filter. Standard fluid is fne. I believe Dextron3 but double check with the autoparts store (tell them you have a volvo) and they can lookup the correct type of ATF.

Most oil/lube shops use a process of suctioning the old transmission fluid through the fill tube. On older cars, this process can damage the transmission since any metal fragments in the bottom of the transmission pan will be "sucked up" through the system. Since they won't perform the service properly (remove the transmission pan/filter and replace the filter). This is why they referred you to a dealer. Any transmission shop should be able to service your transmission. Best of luck!
Greg

Specifications Notes Use only Mercedes-Benz approved fluids

TYPE AF(DEXRON-II (R) Automatic Transmission Fluid) CAPACITY, Initial Refill*: 1982-85 190E 5.5 Liters 5.8 Quarts 1982-92 All w/V8 engines 7.7 Liters 8.1 Quarts 1986-91 190E, 260E, 300E 2.6L 6.0 Liters 6.3 Quarts 1986-91 300 Series 2.6L, except SL 6.2 Liters 6.6 Quarts 1990-91 300SL 6.0 Liters 6.3 Quarts 1992 600SEL 7.7 Liters 8.1 Quarts * Add specified quantity. With engine at operating temperature, shift transmission through all gears. Check fluid level in PARK, and add fluid as needed
diesel TYPE AF(DEXRON-II (R) Automatic Transmission Fluid) CAPACITY, Initial Refill*: 1984-89 190D Diesel 5.5 Liters 5.8 Quarts 1984-85 300 Series w/turbo 6.2 Liters 6.6 Quarts 1986-87 300 Series Diesel 6.2 Liters 6.5 Quarts 1990-93 300D Diesel 5.5 Liters 5.8 Quarts 1990-91 350SD, 350SDL Diesel 6.2 Liters 6.6 Quarts 1992-93 300SD Diesel 6.2 Liters 6.6 Quarts * With engine at operating temperature, shift transmission through all gears. Check fluid level in PARK, and add fluid as needed

Everyone always jumps to head gaskets. There are plenty of MINOR things that can be looked at first.
The Volvo 2.3, 2.4, 2.5 Inline 5 Cylinder dipstick tube is known to develop a large amount of condensationin winter months and stop and go driving. What you see on your dip stick is possibly just condensation. Take off your oil cap and look under the cap and inside the valve cover. Is there any thick foamy oatmeal like substance or noticeable amounts of water? If your oil was saturated with coolant, you would be able to see it up there too. Check your coolant for oil. Volvo coolant is typically brown to orange, however make sure there is no sludge. Start the car with the cap off and keep an eye out for alot of bubbles. A large amount of bubbles is a sign of a bad head gasket. A couple here and there is just air in your cooling system.
Coolant, Transmission fluid, and Oil have several places they can mix. If you have a turbocharged Volvo, the seals in the turbo can go bad and cause a mix of oil and coolant. Your transmission cooler is also in your radiator, and if it cracks your transmission fluid and coolant can mix. I believe turbo models have an oil cooler built into the radiator as well.
Overall if your car sounds fine, you dont see oatmeal, your not using coolant and oil in excessive amounts, dont have white smoke, and your turbo isnt whining you probably just have condensation in your dip stick. If you are overly concerned you can send a sample of your oil to a lab and have it tested for traces of coolant. Headgaskets rarely fail on Volvo's, even the old ones....I have seen many that have gone to replace them have not found a failed gasket and end up finding a bad transmission cooler or a bad turbo.

Does Reverse work? If yes, then a fluid change isn't going to help.