Todd,
Yes,, the filter is a paper filter but that does not mean it traps and holds dirt/debris. It only blocks the larger, harmfull particles from being circulated through the transmission. When the engine is shut off, the particles fall off the filter to the bottom of the pan where the metalic particles are trapped by the magnet. Even the non-metalic particles are larger and heavier and will sink to the bottom of the pan. The vast majority of those particles remain in the bottom of the pan.
An engine oil filter has about 10 or 20 times the filtering surface as transmission filters because it must filter out combustion byproducts and trap and hold them in the filter. The transmission filter, by design does not, and could not possibly trap and hold the debris from the clutches, etc in the transmission. If it did, you would have to change that skimpy filter every 500-1000 miles.
While the filter element may be a paper based filter, but it is not designed to trap and hold particles like an oil or air filter. I use the term "Screen" to clarify how the filter works, is not to say that it looks like "window screen". Filtering is just a matter of blocking certain particles from passing through that exceed the size of the filters openings. The main difference is that the transmission filter is not designed to trap and hold the particles that it blocks, and it makes no difference what the filter is made.
Any transmission with more than a few thousand miles will have debris in the bottom of the pan. Slick transmission shop owners will use this trick to convince people who come in for a routine fluid change that their transmission is about to fail. The difference is the amount of debris for the mileage and the size and texture are more significant indicators. If there is a lot of debris in the transmission pan, but the transmission is running and shifting fine, you are probably being setup for a large repair bill.
If you change or flush the fluid regularly, it's just about impossible for your filter to clog and cause a transmission failure. You are more likely to have an unrelated catastrophic failure that immediately dumps a ton of debris into the pan that can overwhelm the filter, but the clogged filter was caused by the failure not the other way around.
Don't get me wrong. I don't object to anyone changing the transmission filter. I just don't agree that the filter will clog and cause a failure or shif flare, and if you are having your transmission flushed, changing the filter is unnecessary.
On the other hand, If you are dropping the pan to change the fluid, or to make EPC adjustments etc, then by all means, change the filter while you have the pan off.
...Rich