Our 2001 LS430 is at 233K miles and I figured it might be 
time to change the tranny fluid. Not wanting to do a flush and fill at the
 local AAMCO, I decided to drain, drop the pan, replace the filter, and refill 
followed by a couple more drains and refills. Problem is, the owner’s manual 
indicates a 1.9 qt capacity for a drain and refill and when I initially drained 
it, I got 3.5 quarts out of it. If it helps, I did let it drain for over an 
hour. Now, this model year still has the dipstick, and even though I consider 
that dipstick design one of the few annoying things about this car, making it 
extremely difficult to get a good reading, I swear up and down that the level 
was correct (in park and running) before I drained it. Can anyone out there 
personally verify that the 1.9 qt capacity is either correct or incorrect? I
 normally would not question an owner’s manual (especially Lexus), but when we 
bought the car and I did my first oil change, I found I had to put more than 
the 4.8 qt the manual indicated in order to bring it up to the full mark on the
 dipstick, so I know there is a problem with that value. Also, does anyone know 
how sensitive the level is to the temperature of the fluid?

 

Is is important to bring the transmission up to temperature and be on perfectly level ground. Go out and drive on the highway for 15 or 20 min and then check again. It's better for it to be a little overfilled then under. But you don't want it to be way overfilled either. Temperate is very important to correct measurement.

 

Was there a shifting issue that necessitated dropping the pan in the first place? The gradual drain-refill is usually sufficient except in cases where the fluid additive package has been has been depleted and contaminants are floating through the system in mass.

That said, 1.9 qts is not always a given, more can drain out. This is why catching the majority of the fluid and replacing based on that approximates an accurate fill level. (Provided that it was reasonably accurate to begin with.) The tranny is tolerant of slight under and over fill levels. You'll notice if it slips out or does not engage properly when low, continue to add until the shifting is back to "normal". Fill level when at operating temp is just slightly above the hot marker, very similar IME to the 400's.

 

Did you drain with car level or it was on ramps or jack stands. If nose is up then it is going to drain more.
Anyways, fill what you drained or check dipstick when you fill incrementally.

 

A Drain & Refill is not dropping the pan & changing the filter.
I think you were wise to follow this course of action at 233,000+ but you are using the wrong fluid quantities necessary.

Though it may seem counterintuitive , I am suggesting that more fluid comes out during this process than when one simply unscrews the Transmission Pan Plug.

My 2001 LS430 is getting a new filter + fluid today. Originally had parts from my mechanic to DIY but after he carried on & on about using the Toyota Gasket/Sealant properly I decided to just let him do it.

 

Added over 3 Quarts with new filter. Will do a plain jane drain & refill in 5000 miles or so.