Back to your original question - the dip stick goes into the pan under the transmission and shows the level of the fluid in the pan. You're not alone in having issues measuring the fluid level. Several manufacturer's are making transmission fluid levels a non-owner maintenance item because so many do it incorrectly and overfill. Fluid splashed into the dip stick tube or transferred to the tube from the dip stick make the level hard to read with some transmissions being worse than others. Make sure the vehicle is level and has been stationary for a while before checking the fluid level per the manufacturer's recommendation (usually with the engine running and the trans in park). Remove and wipe the dip stick, re-insert it fully and then withdraw. Good lighting helps as the fluid is virtually transparent.

 

It only takes a tablespoon of antifreeze to destroy your transmission.

I've been towing 5500 lbs with the 4L60E all across the Rockies etc. for over 45,000 miles. You need a Scan Gauge to check the tranny fluid level, like this:

Park the vehicle on a flat, level spot overnight. Start the engine, put it in forward, then in reverse, then in neutral. When the transmission temp hits 80 to 85 deg F, check the fluid. It should be at the bottom end of the safe fluid level hash markings or above the little hole in the stick. As the transmission continues to warm up, the fluid level will increase ... not decrease.

The problem with setting the fluid level by trying to get the transmission "hot" is that you have no idea what transmission temperature equates with "Hot". On a cool day hauling down a normal road, my transmission temperature may be 150. Pulling up into Las Vegas stuck behind a laboring 18 wheeler, my temp might be 210. I change the filter every 30 to 40 thousand miles.

 

Some good points listed above....

Being on a level surface is very important..

As for being "hot" I would suggest using the engine temp as a guide, on the condition that the vehicle is driven to the point the engine reaches temp the transmission is likely at operating temp...

 

REPORT ON SOLUTION:

After much exasperation I found a way to get consistent measurements of the transmission fluid level.

From being parked and engine cold, I drive about a 1 1/2 mile, using the most level roads and taking drive-in aprons slowly, to a local grocery store that has a concrete pad at the loading dock that is pretty much level for the large trucks to pull in on for unloading.

The drive either warms the engine up or I sit for bit. I shift through all of the gears one at a time.

Leaving the motor running, and with the transmission in Park and Parking Brake On, I get out and gently pull the dip stick out and check it, wipe it clean, replace it and pull it out a second time to check the level.

Doing this I get a, not to smeared, dip stick to read the fluid level from.