Thanks for responding. Now that we have it we do keep it under a shed. The picture was from when I changed the fluid the 2nd time. I cleaned that stuff off as best I could and then flushed it all out with gas and let it dry for a day before installing new gasket and new fluid. What about parts in the shifter itself like the big spring or the moving parts guiding the shifter? Thanks.
I agree with what John said. And to answer your question, next time you have the shifter top plate off, I'd take those parts in the top plate apart and clean, polish, and lube it all. Plus anything else where you can get to it like the rails where they pass through the case. I'd then lube it with 90wt. before reassembly.... not grease, just use motor oil or 90 wt gear lube. My bet is that you will notice the difference.
It is hard to get the water out of a transmission - often the water enters past the shift lever and just takes up residence inside the tranny. Old style transmission oils didn't have additives to absorb water into the oil;, the water just formed water layers which you see indicated as those rust stains on the gears.
Gasoline - and especially gasoline with alcohol - can really soften old vintage transmission shaft seals, so I wouldn't repeat that procedure too often....it does make things look better, though.
The best way I know of to get water out of the transmission sump is slow but works. It is pretty much what you are doing by changing the oils in there like you have been doing, but to get the most out of those changes one of the top quality trans/hydraulic oils are bestt. They are expensive, but have nice light viscosity and the capability to absorb water. So when you drain them you are draining out some of the water and rust.
Top quality tranny oils are brands like: Ford//New Holland Multi G 134, or Chevron THF-1000, or Shell Rotella HD Tractor Transmission & Hydraulic Fluid . Other name brand companies make similar trans/hydraulic dual purpose oils but the cheaper ones may not have the additives you need.
There are no performance standards for tractor trans/hydraulic oil like there are for motor oils, so that has led to a two-tiered price structure for trans/hydraulic oils. Additives are said to be part of the price difference.
The top quality oils are costly, but I just don't know of an easy alternative to getting water out.
What I would do is clean and lube those shifter components in the top cover plate and then change the oil with some of the good stuff every year or so for a couple of times. And throw a tarp over when you park outside... That might loosen up the shifting and at the least it will keep it from getting worse.
rScotty