not sure how these would crack from overtightening unless someone tried to feed a larger bolt into the holes OR the entire muffler simply hit the ground at some point. at any rate, the photo below shows the back of the car with the bumper & exhaust removed. note the three bolt holes on the back of the transmission. a bracket bolts here; this actually holds brackets #5 and #8 in the diagram below that. it provides the main support for the muffler & is 100% necessary.
without seeing the cracks, i can't say whether their proposed repair would work. i CAN say that swapping out transmission cases is a ridiculous proposition. before you do that, you can have a welder repair the case by either filling the holes & re-tapping OR by cutting off some of the threaded bosses & welding on some aluminum nuts. MUCH cheaper & easiser than swapping out the case.
