1998 Legacy L 2.2 AWD 100,000 miles

Just had used trans put in(from a '97, 45,000 on it). Getting P0740 code(torque converter clutch system malfunction). When first driving, (using on paper route, lots of stops and starts) car jerks and rpms go up to 3500-4500 when shifting. After 20-30 min, all seems to smooth out some. No jerking, rpms up to 3000-3500. Only other thing odd is that speedometer seems to read higher than it should, which also seems to improve after short time driving. Cleared code and it came back 2 days later. Does this tell you anything? Am I looking at major trouble, sensor problem? Haven't taken back to shop yet. Kinda' want some idea of problem before I talk to them. Hope I gave you enough info. Thank You ? ?