OK so I emptied my reservoir using a 10mL syringe (couldn't find a baster), and refilled for a total of 5 times. Car was driven and wheel turned lock to lock while stationary a number of times in between flushes to ensure proper mixing of old and new fluid. Fluid was pretty black and milky to start with, then after 3 flushes it was reddy black, and then pretty clean looking after 5 flushes. Went through about 1.5L of Dexron 3 ATF.
Car still has the same problem. Secretly hoping that after some more driving the problem will sort itself out!