1996 Trooper Transmission issue
 

I have a 96 Trooper 4WD auto. I was pulling a trailer yesterday and while going 60 on a flat road, my RPMs went way up with no indication of why except that the transmission disengaged (it seemed). I eased to the shoulder of the road and slowed slightly and it pulled normally and was ok. I made it about 8-10 miles to my destination but when I had to pull across 2 lanes at the light, the transmission was slipping. I unhooked the trailer and today I went back and put some transmission fluid in it (whoever designed this is demented). It took about a quart and I drove it home. It seems ok...but different than before. When at a stop light it seems to disengage completely until I give it gas. It also revs (up to about 3500 rpm) when shifting from 3rd to 4th. My mechanic friend and I wanted to make sure that there was enough fluid in it so we pulled the check plug and out ran about a cup of dark brown or black transmission fluid. We put about 2 quarts back in...it has the same hesitation between 3rd and 4th. The friend says the black fluid means the trans is shot and will need to be rebuilt/replaced. Any thoughts on this?