To be perfectly honest, you get what you pay for. Consider yourself blessed that you only blew 50 bucks on a bum transmission. At the transmission shop I worked at, I saw people who blew a lot more than that on transmissions they had no clue about.

The moral for your story is to either rebuild the transmission yourself (they're not too hard to do with some practice) or take it to a professional who does it for a living. Don't EVER trust someone's word on a used automatic unless you know them very well and have been in the car with said used transmission.