Have you had any luck with your problem? I am having the same issue, only mine started after replacing the governor pressure solenoid.

 

THIS is the spring that breaks most often.
I just rebuilt my 99's trans (42 RE) because it seemed to "neutral-out" between 2nd and 3rd. While I was inside, I replaced that spring plus the accumulator and its spring with billet parts. Along with the servo for the front band, and the front band itself because it was missing chunks and replaced the electronics within. These were extras, over and above what comes in the standard "rebuild kit". I do my own work, my labor cost me $0, I don't like redo's. and it cost me less than a junkyard transmission would have. 10K miles and counting so far, working great. I actually bought my 96 4wd with the tranny in the bed of the truck, (46 RE) and rebuilt that one about 60k miles ago, still going strong.