I had this problem with a 727 in my Charger years ago. I had a 727 rebuilt to swap in, then some time passed. 18 months later I swapped headers and installed the "rebuilt" trans, along with a 3000 stall converter. It seemed okay at first, but within a couple of miles the trans seemed to slip alot. At one point while in park, I couldnt rev it past 2800-3000 rpms and it felt like it was both in gear and in park at the same time. When I smelled the fluid, it was almost black and really stunk.
The shop covered the trans. Sure, I had to swap it out, but no BFD. Later when they tore the trans down, the man said that the clutched were welded to the case and grit was everywhere inside. The trans was scrap. NOT trying to scare you, but I have wondered for awhile if the trans was AFU from the start or did it cause damage sitting through the summer and winter....Hmmmmm.
...roger that. BE SURE that the KD lever moves the full range. It is probably locked FULLY to the rear.