I wish I'd gotten here earlier...
Yes, it leaks because the o-ring fails.
That's the newer, electronic version of the cable driven speedometer gear unit.
You take out the bolt in the upper right of the image, remove the retainer, pull out the unit (you did drain the fluid, right? If not, you have now), remove the old o-ring... and reverse that procedure to reassemble.
The sensor doesn't need to be replaced unless it's not working.