...stuck in 3rd gear.?
The fluid is at the correct level, but the garage says that it is burnt and that the only sure fix is a replacement at just less than 4k.
you might be low on transmission fluid.
try refilling to see if it helps.
autozone also has a free diagnostic tool. try taking the car to them.
Edit: geez that suckst! I suggest you try to sell it. Maybe put a cheap additive in there, like trans-x to clean it out. Then sell it. lol, thats horrible. Well have fun with it until the transmission finally goes! That is actually not uncommon with the S80s. I have no idea why Volvo (well, Ford) didn't make that a recall. ridiculous.