[Car Nut]

Nice meeting you last night Tinny and as others have said, we feel your pain.

I see the transmission you used started out life as a 4R70w which is a computer controlled Ford automatic overdrive. These transmissions come with an intergral torque converter housing that mates to late windsors or modular motors and require a modfication and an adapter to fit the FE motor.

The internals really need to be worked over too to handle the additional power as in stock form are supposedly good for a maximum of 400 hp.

Finally a computer control operates the transmission which controls up down lockup firmness and all other aspects of the transmission.

They can be made to handle over a 1000 horsepower.

Your gear hunting problem is most likely a matter of seperating your shift points and throttle position settings.

As far as the rest of whats going on I don't have a clue, but I would really suspect an issue with the fitment of the transmission, correct clearance between the torque converter and flexplate. Not enough clearance and it will eat the thrust bearing out of the motor and/or ruin the front pump of the transmission.

I am mentioning this because when the find the cause, you may have other damage that is not immediately apparent. I would be very insistant that you are properly informed of what they find and what they check for.