Heavy Duty 1963 Pushbutton 904

That kickdown arm is supposed to be pushed all the way back when the carb is all the way open. Pull in and out on the input shaft to get some idea of the amount of internal wear. !/8" is past the .040 max recommended, but they still work with even 3/16". Checking the bottom of the pan for debris probably wouldn't be a good indicator of clutch and band wear since it's probably had the pan off several times. If your fluid looks brand new and end play is at a minimum, it might be okay to run as is. But if you want to drop out the front drums to check it, we are here to help supervise.