Ouch... That's a bummer about the truck. As for suing, though. I'd try to exhaust every other possible solution, first.
Now, the fair disclaimer... Don't take the following as legal advice. I'm not a lawyer. I would certainly recommend talking with a real lawyer to confirm what you can and can't legally do. But, as someone who has looked into suing for something rather similiar (I didn't bring suit) I have the following info for you.
Florida small claims court looks to be a little better organized than Michigan's. I found this small claims FAQ from a county in Florida. It should be very similiar to your case, and small claims courts are typically standardized at the state level.
Clerk of the Court - Escambia County, FloridaBut, according to that, you'd be looking at about $80 to bring the suit. And, then, if you're able to win the judgement, you'd probably have to pay for the collection method, as well. In other words, the court can award you the money, but then it's your responsibility to try to collect it. :-/
Now, as I understand it, the maximum amount you can win from this method may not be all that much. Since you sourced the rebuilt transmission yourself, the shop may not be responsible to reimburse you for the damages to EITHER of your trans. Most repair shops have a waiver on any coincidental damage as a result of their repairs. In other words, with that waiver, you may only be able to collect what THEY charged you in parts and labor for the repair. (Not the total amount you spent on parts that ended up destroyed.) Whether this waiver stands up in court or not, is something that would have to be decided by the judge. If you bring a strong case, and the repair company is unprepared, I suspect the waiver would be found meaningless, and you could collect full damages, but you never know...
So, even winning may not collect what you hope. Especially when you factor in the amount of time and effort you'd spend. :-(
Personally, this would be my course of action.
1) Talk with the repair shop and bring them evidence of their mistake. (Don't GIVE it to them, but let them know you have it) Pressure them a bit and see if you can get them to cave some.
If not, then
2) Talk with a real lawyer. Find your actual rights in this situation. And, if possible, have the lawyer draft you a threating letter to send the repair shop. Most lawyers will do this for a nominal fee. Hopefully this will be enough to scare the beejeez out of the repair shop and get them to cave in and pay you back.
If not, then
3) Sit down and do a real cost/benefit analysis of pushing further, now that you know the facts.
Good luck, my friend.