Ron,
I think an air test is going to be my next step.
I spoke with my local transmission parts guy this morning and his thoughts were that the direct clutches were welded or stuck due to a mechanical failure. He recommended I do an air test on it to confirm though so I'll give it a shot tonite. He also mentioned that if they were constantly engaged, it could cause premature wear of the front band. To be fair though, he also thought that I may have it set to tight at 1 3/4 - 1 7/8 turns out and recommended it be closer to 2 - 2 1/2 turns out.
In either case, with less than 30,000 miles on it since it was replaced, it was loose enough that I could put my finger in between the kickdown lever and the servo prior to adjustment so there is definitely something going on there. What a bummer. I'll let you know what I find this evening. Otherwise if you've got any other thoughts, feel free to let me know. I appreciate the help.
-Trent
P.S. To answer your question, this is a stock valve body...