I started putting a little dab of sealant (pretty much anything) on the very top edge and near the top two bolt holes to keep the gasket from slipping down when I'm sliding the drive back on. The top surface of that gasket is only about 1/4" wide and I've had it slide down just enough that the upper part of the gear housing caught the gasket and broke it as I slid the drive in. I torque it down in 3 steps- snug, then snugger, then 50 lbs/ft.
My .02
Ayuh,...... I use plain ole Grease,......
The big o-ring, a couple dabs hold it,....
Run a finger full 'round the bell housin' keeps the paper gasket tight to the housin',....
'n another dab or 2 to hold the smaller o-ring on the water port,.....
Don S was big on Perfect seal dabbed under the paper gasket, 'n bellows cement for the 0-rings,.....
I also use the Sierra Alpha Gen.II gasket sets, 'bout 6 bucks at my local Napa,..... 1/2 doz. a time,.....
That set works perfectly on the MC-1s, Alpha 1s, 'n the Gen.IIs,.....
'course the gasket sticks out past the MC-1 housin's, but who cares, it seals just fine,....
Oh,...... 'n I've never used a torque wrench to put on a drive,...... 'n never had to retighten,...
Just a socket, ratchet, 'n my calibrated elbow,..... Never had 1 go Loose, unless there were
Other problems,.....