Excess fluid is not causing the leaks, just makes them show up. Yes you'll need to drain the fluid. Probably needs to be done anyway. Flushing with diesel is a great idea. Being the trans takes 13 gallons of gear oil it will take about the same amount of diesel to get a thorough flushing done.
I drained the oil in my SH, changes all the seals, then flushed with diesel. Found a newly replaced seal leaking and redid it. If they don't leak with the diesel they won't leak with gear oil.
Check the archives on changing the seal. Not a bad project. I haven't done an M but my SH was easy.
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