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Don't use Engine oil in a Hydro unless that's what it calls for.Hydro transaxle fluid has additives in it designed for clutches and swash plates which engine oil does not have.You'll burn up your pump very quickly if you use regular oil.

I used Traveller Universal tractor transaxle/hydraulic fluid from Tractor Supply in my HDS 2165 and my old CC 127,129 and 149.Seems to work good.It is a tad bit thicker than Case/IH Hytran so it takes a bit more time to heat up to operating temps in colder weather.It will feel a bit sluggish till it's warmed up.

2 gallon jug is around $20 at TSC.

Don't skimp out on the filter.Get a good Fleetguard or an OEM Cub filter.

There was a newer Fram hydro filter on the 2165 when I got it but the guts in it had fallen apart and clogged up.Tractor was diagnosed as having a bad pump but it was just the filter.Paid $200 for the tractor,put new filter and fluid in it and cleaned it up and sold it for $600 a couple months later.I still do maintenance on it every spring for the fella that got it.He's still very happy with it 3 years later.
I don't know if I'd go as far as to say it will burn the pump quickly, see thread about my dads 782, had it in there for three years and not burnt up, although I found it strange that that's what the shop put in it, haven't made any progress on that tractor or any here (had 3-5in of snow in past 2 days), I would go by what the manual says or an equivalent.
 
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