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In Reply to: Transmission failure after block replacement posted by Michael Einspahr on February 04, 2001 at 20:25:24:
the dowels are mandatory. This is stated in the TIS (Technisches Informationssystem). They are engine mounted on the M20, M21, M40 engine and transmission mounted on the M10, M30, M70 engine.
Missing dowels can cause misalignment and converter malfunction as well as noise and load to the input shaft of mech. transmissions.
BMW also states that all claims responding from misissing dowels after engine, transmission changes will not be honered by them. Cost has to be borne by the dealer. If they indeed have not been reinstalled they could have been the cause for failure.
On the other hand this just a help to properly align the two parts (engine and transmission).They could lead to excessive load on some bearings.I don't think it could result in loss of transmission fluid.
Sorry, but I think a valid claim will be difficult. Regards Ekkehart