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Originally Posted by browntwig
Well, I had the same problem with the 99 Taurus SE. Had something to do with the pump shaft and a gear that made the gear shaft sit at an angle. That was what caused the screech (grind). We did have the starter replaced when this started, but that obviously didn't take care of the problem. Eventually it would grind when put into reverse and then when it would shift into first and second. Once it was warmed up, no noises at all!
Took it to the dealer last night so they could hear the noise as they started it in the morning. (It wouldn't do it if driven at all.) They called today and to fix the issue was only about 750 more than replacing the transmission. The car has 114,000 miles, so we're replacing the tranny. Can't afford a new car, and because this car is solid with a great engine, decided to pour money into it. Besides, it's cheaper than buying something new, and because we ordered this car and received it from the factory, we know the kind of care it's received in the past six years. Don't have that same comfort level with a different used car.
All told our bill will be about $2700. EXPENSIVE!!!!! 
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Browntwig,
Thanks for the heads up. I plan on dropping my car off tuesday at a transmission specialist. I'll post back what I find out. My Taurus has approximately 116,000 miles on it so it's interesting they both are failing with about the same mileage. If it's cost that kind of money I may just go ahead and trade it in.
F