[jocko]

Jeff mentions an excellent point - seal orientation is critical, and it's easy to screw it up if you just put it in the way you'd view a timing cover crank snout seal. Remember the goal is to keep fluid OUT of the adapter (it's dry in the middle) and IN the trans/t-case - but, you are installing the seal from the outside of the adapter, facing inward (not like a timing cover crank snout seal). So, when it comes to installing it - you'll need to press it in with the open side toward the outer faces of the adapter as Jeff said (that's the best description I've heard of the orientation Jeff - when folks say "with the lip out or in - it never helps me picture it, ha). Be careful to not damage the lip and ensure the spring stays inside the lip before you install the trans and t-case. Anyway, here's a ref pic also: