What does a programmer do for the trans?
 

I have been told that programmers reprogram AOD's to help hold the trans in lock-up/overdrive with greater throttle input than normal. Is there any truth to this?

I know my '97 7.3/AOD loves to downshift with a load on the slightest hills whereas a buddy's 7.3 with a 1705 programmer requires excessive pedal to downshift out of OD.

Many programmers provide changes to shift points and shift firmness, plus the added HP in the lower RPM range can help with the "downshift" condition.

Are programmers only adding power requiring less pedal or do they really hold the trans on OD? This buddy claims he has to go nearly to the floor to downshift where I downshift at half pedal.

Both, depending on the programmer. The 1705 will adjust the torque converter lockup point, giving your buddy the difference in driveability on those hilly sections.

What about the Edge? Does it do the same thing?

Yes, the Edge will. Here's an excerpt from the Evolution manual:

WOT (Wide Open Throttle) Shifting
On automatic transmissions, these are the RPM points at which the vehicle will shift when you are at Wide Open (full) Throttle. Raising these values helps to keep the engine in the peak power curve after a shift.
(Hint: Raising these values may help improve 0-60 and quarter mile times.)

Standard (Std.) Shifting
On automatic transmissions, these are the MPH points at which the vehicle will want to shift during normal acceleration. Positive values will cause later shifts while negative values will cause shifts to occur sooner.
(Hint: Negative values may help improve fuel economy while positive values will improve performance.)

Shift Firmness
On automatic transmissions, these values represent a percentage change in shift firmness, or in other words how “hard” your transmission will shift. A positive number will cause the shift to be firmer. A negative number will cause it to be softer.
(Hint: Firming up the shifts may help improve 0-60 and quarter mile times.)