I was looking at my transmission yesterday and notice this metal piece sticking out of a hole right under the transmission cooling line adapters. I believe this trans is a th350.

I took a picture of the thing im talking about because my description of it sucks. Thanks in advance.

 

It is where the kick down cable goes.

 

That's correct. The end of the kickdown cable slips over the "S" hook to actuate the kickdown valve in the trans. The cable sheath fits into the hole and is retained with a small bolt. Yes, you need one for the trans to operate correctly as well as to prevent trans oil from spewing out that hole.