For those who question whether the output shaft needs that bushing, here's the TM 9-8025-2 manuals answer for that.
So far on six 303M transmissions I have torn down this year. None had this bushing installed.
I truly believe the "factory" screwed up here. So every military rebuilder afterwards didn't even look for a bushing here since these two pages (160 and 161) are the only place in the whole manual even mentioning this bushing. Civilian mechanics would have known there was supposed to be a bushing here, like I did.
I'm pretty disappointed in the quality and layout of this manual. It's like a child put it together. Or an absent-minded person. There is no clear line of disassembly or reassembly. There are parts I know I read but after looking for hours I cannot find that passage again. Really makes me mad as I was going to mark this one page but thought I'll do it tomorrow as I was tired and wanted to go to bed.
I'll find it, but I shouldn't need to try and find information like that. Civilian manuals are clear and precise. They of course need to be as the mechanics would lose the company money if they needed to find information and had to spend hours trying to find it.
Of course, my observations are five decades to late !