240 1993 Rear Main Seal replacement

[240Dad]

My 93 240 has 175000 plus (odometer broken) miles on it. I have had it a couple of months and, in that time, I have cleaned the underside and watched the oil leak return narrowing it to the rear main seal.
This weekend I took the tranny out and got to the seal. There is a lot of the red gasket goop all over the carrier and, as you can see in the pic, the spring is showing. Because of these two clues I surmise that a previous owner has had the seal replaced and they have exposed the spring on installation. The lip is still there where the spring is exposed it is just that the spring is in front of the lip.
I conclude that this is the problem causing the oil leak.
Now, I have questions:
1. What is the best gasket goop to use on the carrier gasket? I used Indian Head on the rear main seal housing gasket.
2 Is there a technique that will ensure I don't make the same mistake as my predecessor? I installed the housing, greased the shaft and inside of the seal, kinda rolled the seal on then used the old seal and a neoprene hammer to tap it into place.
3. The seal that is in there was flush with the rearward face of the carrier. The new IPD seal instructions state that I can move it inward some to ride on an unworn portion of the crank flange. I am assuming I can sink it in a little as long as it is uniform all around. Is that correct? I inspected the shaft and found it to be smooth so I placed the new seal the same depth in the housing as the old.
4. Should I take some steel wool to the crank to clean it up prior to installing the new seal? I used emory cloth to polish the crank then cleaned it thoroughly. I also placed a rag over the opening in the oil pan to keep it clean.
As always, I appreciate anything you can tell me based on your experience/knowledge.
Bill