How much metal flake is too much?

Have done this thing many times. Replace the filter, check band adjustment, drain convertor, clean pan and new gasket. After that maybe it will be good, but no guarantees.
Don't waste your time draining the converter. It's probably a lockup, and to get ALL the junk out of it is damn near impossible by draining it. You can try, but it is in my way of thinking a waste of your time.