Back when I was young, my father told me I should drive my car in 3rd gear around town to save the tranny from shifting in and out of gear at 30 to 35 mph. And "D" when I am freeway driving.
Is that saving my tranny? or just goofy

Drive in 3rd gear if your speed will be consistently under 45 mph, or in stop and go traffic.
On the Freeway use D when crusing and such, the constant shifting/lockiing unlocking of the Tourque converter creates heat, and can be harmful

Whoa, whoa, whoa. Hang on, there'* something you should consider here.
Your Dad was talking about "Drive" and "Overdrive".
Overdrive lets the trans select from all four gears including the highest, over-driven gear. "Drive" lets the trans shift freel between 1st, 2nd, and 3rd, but blocks out the overdriven 4th gear.
In a trans where the shifter has a labelled 3rd gear, that is NOT the same as "Drive".
Any numbered gear will try to stay in that gear until FORCED to let it go, either by over-revving the motor(near-redline), or by under-revving it(near-stall), both of which are bad for the motor.
We have a labelled 3rd instead of "Drive", so the best thing to do is drive with shifter in overdrive and let the car decide for itself. Our transmissions are pretty smart, they can handle it.

WHOA WHOA WHOA!!!

3 is equivalent to D and D is equivalent of O/D on our cars..put the car in 3 brian, and i guarantee it will shift through all 3 gears just perfectly.. My Ford on the otherhand, if i put the selecor in the 3 setting, it will stay in 3rd gear

I do know that my friends Buick Roadmaster Instructs you do in the owners manual to use 3 while around town, and when expecting speeds in excess of 50mph to use D. I try to do so in my car, but havent gotten into the habit of doing it instinctively yet

i do the exact same thing, i leave my shifter on 3 untill i reach 45-50 and then after that i put the car into OD

At 162K , I drop it where the manufacturer tells me..

One spot past neutral.

Same here but with 200K. And I drive mostly city miles.

I have heard of this before and I don't think that it makes any sence, the only time I have ever put any vehilce I have ever owned in third or drive or what ever you wanan call it is when towing, I agree with the 2 posts above, one past netural is where it goes on my vehicles.

the reason behind outting it in Drive (3rd) whiel under like 40mph or sois that when its in Drive(3rd) gear it is 1:1 raitio... so the Planitary gears arnt spinning in the trans.. in O-Drive(4th) the planitary gears are spinning so it couses more Heat and moves more parts...

Well that makes sence, but unless you live in Chicago or something like that where it really is stop and go constantly all the time I really don't think it matters......... IMHO......