Tom you NEED gauges to really check anything dealing with your hydraulics. I don't know who told you that a 2500 PSI gauge was $200. Here is a link to Bailey Hydraulic. You can buy a 0-3000 or 0-5000 PSI gauge for $13.
A couple of cheap gauges and a few fitting will not run you over $75. You will waste that much time/money in guessing what is wrong with it.
Also hydraulic oil that has been aerated is not bad. The air will come out of it just setting around. IF it has water in it then it would need to be heated to make it separate.
You can save your self some money just doing a few simple things.
1) Buy a IT service manual. They are not as good as a factory manual but they are better than trying it this way. THIS very site has them.
http://www.ytmag.com/IH202_6925.htm.
The cost is $29.95 + shipping. So maybe $40 tops.
2) Get a pressure gauge to check things out. Cost will be less than $20 with shipping.
So for less than $50-60 you can get a much better idea of how deep you problems are.
I will tell you this. A IH with hydraulic issues usually takes someone that understands there hydraulic system well to fix it correctly the first time. I have seen too many guys just throw money at them and never get them to work correctly. Even with all of the years I have worked on tractors I still get someone to help me on IH trouble shooting the hydraulics. If you have to hire some one good just to look at it to tell what to fix will be money well spent.
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