Initial problem: 1983 Ford E100, 302 engine, AOD with throttle rod connection will shift 1-2 but not 2-3 nor into OD.
Replaced Valve Body (VB) with remanufacture unit and the problem was fixed, shifted at right speeds into all gears for about 30 miles... Driving on highway (~ 60mph) passing a slower vehicle and transmission downshifted and would not upshift , same initial problem returned ( this was with the new remanufactured VB). Vehicle does not appear to neutral out in 2nd, just continues to pull in 2nd to about 4000 rpm (~ 63mph), (TV pressure about 30 -50 psi), when I back off the throttle, no upshift, applying throttle again still in 2nd gear.
Previously connected gauge to set and measure TV pressure when each part was changed, warmed up @ idle in neutral -- 0 psi ; 0.39 inch spacer at carb throttle rod neutral -- 32 psi, OD -- 35 psi, WOT -- 80psi.
Checked and cleaned governor , no change. Replaced governor with remanufactured unit, no change.

Replaced VB with another new remanufactured unit, torqued all bolts on VB and filter to 90 in-lbs, no change in upshift problem

Same problem persists with three valve bodies and three governors.

In original VB found broken retaining clip holding end plug on 2-3 Back Out Valve, recovered 2/3 of clip imbedded in end plug. Did not recover about 0.3 inch of the clip.
Did not notice any metal fragments in discarded ATFs.
Replaced original Mercon with Mercon V, and have replaced it 3 times with new fluids, about 8 quarts each time. Did not drain the converter.

I've considered possible problems in the torque converter, clutch or a broken input direct drive shaft, however according to most info on the various forums on the web, malfunction of these parts do not fit my problem, does not neutral out at 2 - 3 shift point, stays in 2nd gear, doesn't appear to go into 3rd gear at all.

I don't understand how the split torque works in the converter for 3rd gear, could this be the source of the problem?
If the direct drive shaft is broken, what would happen when trying to shift into 3rd gear? ( I read online that in 3rd gear, 40% of engine torque is going through the torque converter and 60% would be going to the now broken direct drive shaft?). Would this appear to be still in 2nd gear or would it neutral out? Backing off the throttle at 60 mph what kind of engine braking would occur in this case?
Any suggestions, comments appreciated.

 

You might try posting this in FTE's Transmission forum found here: FTE Transmissions. Regardless which chassis an AOD is installed the operation and fixes should apply to most of them.

HTH