A 78 Marquis is a really nice car, the quality on those is right up there with Lincolns of the time, they were truly built to last. Hope you get a chance to enjoy it this summer.
I'm not an expert on either of these topics but I own a 78 Town Car also with the 400 motor. Mechanically real close to yours.
Assuming the engine is still running OK,
I know on these C6 transmissions they use a vacuum modulator (just a diaphragm really) to tell the trans what kind load is on it, if that's blown out or vacuum leak to it you can get poor shifts, bad shift timing, things like that. There is a vacuum line that runs back to the trans, if you have a vacuum guage you can check for vacuum at the modulator with the car running (check at the end of the rubber hose, and check the modulator itself to see if it will hold vacuum. That's all I can offer, other than checking fluid level and condition. The C6 is a very stout transmission, they tend to give reliable service even in high power applications.
With the grinding and air sound you could check for power steering leaks so you know if you're drawing air in somewhere and getting an air pocket, bleeding the system of air may help (simple procedure ). Where does the sound seem to be coming from?
09 Grand Marquis
99 Town Car Touring
06 Town Car Signature
78 Continental Town Car