Dolores,
I am happy that your ROM has increased and your pain has lessened. This helps make the case that continuing to run through your recent condition may have aggravated the injury to your knee, although there are other explanations. Tight muscles still inhibit ROM when x-rays rule out bone damage, and they can hurt all by themselves. The fact that they have relaxed over time certainly implicates their involvement in pain syndromes, whether cause or effect. However, there is still the question of why the knee remains swollen. Your first post mentioned that the pain was at the back of your knee, which is a clue that should not be ignored, but you did not mention where the swelling was located.
Most knee swelling is localized to a particular part of the knee that tends to accumulate fluid as a way to mitigate accidental or repetitive trauma. For example, tradesmen who kneel a lot have a tendency to develop swelling at the front of the knee, where protective bursa are located. Bursa are small fluid-filled sacs that cushion the movement of tissues, including bone and tendon, past each other. Obviously, this means that blunt trauma, sustained pressure, or repetitive motion can irritate them, leading to a condition called bursitis - or inflammation of the bursa - which is sometimes followed by a visible increase in the amount of fluid in and around the bursa.
Swelling at the back of the knee is often referred to as a "Baker's Cyst," so named, according to popular etymology, for the tendency of those in the baker's trade or other forms of work that require standing and carrying, to develop this affliction. The swelling leads to localized pain due to pressure from this accumulation of fluid. If a baker's cyst was the cause of your pain, you would still need to find out what was the cause of the fluid buildup. While you indicated that the initial pain was in or at the back of your knee, it is unclear from your posts whether the swelling was in the same location.
The docs hypothesized from your symptoms that you may have torn cartilage, undiagnosed at this point without the benefit of a detailed MRI. This is a common sense guess, but the prescription to discontinue running would likely lead to a lessening of symptoms in any case whether repetitive motion or actual tissue damage was the cause of pain or swelling. However, amelioration of symptoms due to suspension of activity by no means confirms the initial hypothesis. We still need to more clearly define what is swollen, what was/is damaged or irritated, and whether or not there is room for an optimistic prognosis without any further intervention than decreased activity.
Remember that when you run, regardless of speed, your feet are hitting the ground about as often as those of a world-class athlete. Running slower means each mile for you will take a lot more foot-strikes. While the impact force may be less than for a pro, other repetitive motions involved in running will take their toll. If for example you are an overpronator, your knees may be subject to even more twisting than those of the runner who just won that last race you were in. It's more about the style or biomechanics than the speed, but it's amazing how long the body can survive a very basic maladaptation. Though the actual cause could be anatomical, this injury may have been a long time in the making because your body adapted well for so long. That doesn't mean you are doomed, but that your success spared you from immediate intervention. There's still time to get back on track.
You told us that you don't want to throw a lot of money at this problem, but that does not condemn you to a life of pain or inactivity. No matter who eventually solves this problem, a doctor, therapist, internet guru or yourself, the same steps of discovery and definition will have to be taken. You may not have the money for advanced treatment, but at 63, you probably have more time to learn about your injury and how to approach healing it than most of us do. Regardless of how the problem eventually gets solved, it is in your best interest to learn as much as possible about exactly what the problem is. If better information does not enable you to solve the problem yourself, it will certainly allow someone else to solve it for you.
When the swelling has transferred to a location under the kneecap, it would help bolster the argument that cartilage there has been at least been roughened, if not torn. Unfortunately fluid buildup alone does not distinguish between these conditions. Here it helps to know a little physiology in addition to obvious anatomy. Most swelling that people encounter throughout their lives has a lot to do with circulation and blood supply. Heat and redness often attend this kind of inflammation, and it is usually quite rapid in onset, because of the pumping action of the heart. However, the hyaline cartilage that makes up our joints exists for the most part independently this kind of plumbing. Instead, synovial fluid that surrounds and lubricates our joints is the medium that also nourishes and repairs their cartilage. It makes sense then, that a gradual increase in this type of fluid, versus blood flow, would occur in response to an injury to the tissue that is dependent on it. Once again, it is common sense to conclude that a gradual and sustained accumulation of synovial fluid suggests damage to nearby cartilage, but there is more to know.
We need to know if you have a problem under your kneecap due to the repetitive motion suggested by your running history. If you press your hand down on the kneecap while bending the knee, and you feel a grinding effect as you bend it instead of smooth motion, one could reasonably conclude that your current knee pain and swelling were at least related to chondromalacia, or the degradation of sub-patellar cartilage (patella=kneecap). Pain and gradual swelling would be your symptoms in this case, but it is important to note that hyaline cartilage has little nerve endings to produce pain. The pain, though often hard to pinpoint, is thought to come from supporting structures near the cartilage, that actually have a blood supply and innervation.
If you tore a ligament or articular cartilage, we would expect a more rapid onset of these symptoms. If you tore a meniscus, depending on the location and severity, we might expect some circulatory swelling because the menisci are partly vascularized, which would bode well for you since much more self-repair is possible in cases where blood (and immune system activity) flows to the damage. The portion of meniscus without blood flow is slow or impossible to mend without surgery and can be a source of frequent irritation when left untreated. I'm going to place that to the side for the moment because most people with lateral meniscus pain refer to it directly, although it is not the only cause of pain in those locations. Ligamentation, tendons, bursa, and sensitive muscles can also be the culprit.
Back to roughness under the knee, there is a curious catch-22 that can occur with this type of injury. Some (not all) researchers posit that chondromalacia is mechanical damage due to the kind of wear one might expect when forces controlling the kneecap are unequal. This is referred to as patellar tracking disorder, where one side of the kneecap, which should ride down the middle of a groove in the femur (femoral or trochlear), is dragged over the bone by unequal flexion of the quadriceps group. The curious part is that an observation was made that swelling under the kneecap was associated with a reduction in contraction force of the medial quad, which ironically, might exacerbate tracking problems. This would contraindicate further running until that problem is solved, as you were so advised.
Other contributors are thought to be tightness of the lateral quads or their tendons, but one must take into account the contrast between the lateral and medial quads as equally important to this theory. Another factor is hip geometry and the resulting angle of the quadriceps to the knee ("Q" angle). Whatever the cause, it hurts, causes swelling, and results in further damage if ignored and untreated. Direct treatment of the suspected cause often consists of strengthening exercises you may have already mentioned, and/or relaxation of the tight muscles involved via targeted massage techniques.
The continued swelling bothers me. Something is damaged or at least irritated. Since running doesn't help, and as CRL mentioned particularly on the treadmill, there is a case for suspecting a biomechanical fault that may have caused damage within the range of your recovery before the treadmill, and was pushed over the line after that small adjustment to your training. This could make the results, out of proportion to the change, simply a matter of thresholds. Here is where knowledge and skill can come in handy, to identify these faults and remedy them. Experienced practitioners have seen and corrected faults not only in muscle strength, preparation and use, but by modifying forces generated by the underlying anatomical geometry through the use of appropriate footwear.
So, you have the immediate need to handle the injury, but the more important responsibility to track down what caused it and prevent it from happening again. Do all of these, and you may be able to write your own prognosis.