There should be no lateral play in the upper agitator shaft nor should it leak oil when turned upside down. The shaft is toast, as well as the sleeve bearings.
12 series upper transmission housings are not compatible with previous models. A 12 series housing is only compatible with the 12 series transmission. It's probably easier to find another complete transmission (any tall tub transmission from 1966-1989 will work) and go from there rather than trying to locate an upper 12 series housing. However, if you want to go that route, the smaller tub transmission housings generally have less wear and tear on the upper shaft and bearings.
12 series upper transmission housings are not compatible with previous models. A 12 series housing is only compatible with the 12 series transmission. It's probably easier to find another complete transmission (any tall tub transmission from 1966-1989 will work) and go from there rather than trying to locate an upper 12 series housing. However, if you want to go that route, the smaller tub transmission housings generally have less wear and tear on the upper shaft and bearings.