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By not shifting out of third I mean that from a stop it shifts from 1st to 2nd to 3rd fine, but it never shifts into 4th, it just revs high in third and never reached speeds higher than 50 MPH without sounding like it is about to have an aneurism.
Bob is right, its a 3 spd automatic, so its never going to shift into 4th. I'm not up much on the auto tranny stuff, but I'd guess it is slipping, like it is either needing fluid or something wrong with it. I don't think the two problems are connected. I cannot see how ATF could ever get anywhere near the brake booster unless someone poured something in the wrong place. Check the fluid level in the trans and add some if needed. If that doesn't get it, take it to a transmission shop and let them diagnose it. Should not cost you anything to have them give you an estimate.
If I understand you correctly, you get fluid out of the vac hose or the port on the booster that it hooks to. If that is the case, then you are probably right that you need to replace the booster. No fluid should ever make it into that part of the booster. You could take it off the firewall and clean the gunk out of it, but if brake fluid can get into the engine through that hose, then air will leak there even with a new master cylinder on. Must be that all that brake fluid and gunk has just killed the booster seal.
What I don't really understand, is how revving the motor makes any difference. You'd only see fluid if you have the rubber vac line unhooked, and then there would be no reason for the booster to do anything different with the motor rev'd up or not. I guess vibration is make some of the gunk inside of the booster spit out the hole.
Ok, one last thing to consider is that you might also have a leak in the wheel cylinders. The master cylinder can fail on only one part, front or rear, but you might have a leak somewhere in the rear brakes that made the problem show up. Look for signs of wet around the brake drums and where the brake line hooks up at the end.