Just bought an '88 F350 with the 7.3L/C6 in it. Trans was rebuilt last month by PO and he said they added a shift kit to it. Bad idea for a diesel. This thing winds out 1st gear to the point where I think the engine is going to throw a rod (tach does not function properly, so no RPM's for ya).

2nd gear will do the same, but if you don't get up to 40-45mph (speedo doesn't work either, so just guessing) and let off the throttle completely, it won't shift to third. It will scream along at what sounds like close to 3k RPM's in 2nd all day long...even when the throttle is only open 1/8. If you get it to shift to 3rd, anything more than 1/8 throttle and it will kick back down to 2nd again...

Do you think removing the shift kit will solve my problems?
Or do you think there is something going on with the trans or mis-adjustment of the kick-down?

I've got 7 vehicles and this is the only automatic I own...so I'm new to these things...

 

sounds like the vac module needs adjusting.

C-6 Modulatoriagnose and Replace [Archive] - FSB Forums

 

I would doubt it is the shift kit. Sounds more like a vacuum problem.
Pull the little rubber vacuum pipe off at the trans and look for signs of transmission fluid in it, if any found then replace the vacuum modulator at the trans.
If that is OK check that the rubber pipe is good and that the steel pipe it connects to is not kinked/crushed.
Now lift the hood and look on the drivers side of the fuel injection pump and you will see the VRV with two vacuum pipes going to it. Follow both along their length and make sure the pipes are good.
If all that checks out you would need to connect a vacuum gauge in to see if the vacuum pump is good. Should see around 20in of vacuum at idle.
If that is good you will need to put the vacuum gauge on the inlet pipe to the VRV and check that full vacuum is there. Then put the gauge on the VRV outlet and check that, at idle, you have full vacuum but as you open the throttle the vacuum falls off gradually. If you do not have full vacuum here at idle then the VRV could be faulty.
Finally check that the kickdown rod is connected to the lever at the trans and to the throttle linkage near the injection pump.