Rebuild, Reman, or Repair?

My AW4 tranny just lost 4th gear. Lots of stuff sitting down in the pan when I changed the filter so it's got I've got problems. A guy that used to be a mechanic for a Jeep dealership told me that rebuilding this tranny wasn't a good idea. He said the Jeep dealer he worked for always replaced not repaired or rebuilt them because they had a lot of trouble with rebuilds. I'd never heard that before so before I make a decision on which way to go I'd like some of y'alls input.

Thanks!

XJ

In my opinion, a "properly" rebuilt trans would be better than a junkyard pull-out that's operable. I also beleive a new trans is better than a rebuilt. You have to consider the the cost of each choice in light of such things as how long do you intend on keeping you XJ, and in what condition is the truck overall? Put a new trans ($$$) into a beater? Put a junk-yard trans into a fully restored truck?
If you go the rebuilt route, insure the rebuilder is reputable and that it comes with a good warantee.

Avoid aamco and the other discount mass market shops. Check out Jasper, we've had two motors and a transaxle from them plus a bunch of friends of ours have had 2.5L and 4.0L's put in from them. They have good coverage and their engines run strong, the transaxle in the wifes olds actually feels better than the original that was in there...the original had a lag between shifts, the new jasper postivley snaps between gears.

I also highly recommend Jasper. Their stuff is as good as it gets really. I bought a remanufactured 4.0---well worth the cost.

With how cheap a used AW4 is, I would consider using a used transmission. http://www.car-part.com/ is a good source for finding parts, and if you're going to do the swap yourself you could end up not spending much at all. (125$ for the cheapest listed ones in my state)