Our OD units aren't built to withstand the loads applied when towing. Sure some people do it and have no immediate issues but it does put undue stress and heat on the OD unit and the trans. Heat is the destroyer of our trans as well as just generally being weak. The engine however can cope with increased RPM. If you are running at the high end of 3rd one would assume you are cruising at red line and thats not good for anything.

Short version: OD aka 4th can not handle the strain put on it by towing a load. Even the owners manual says do not tow in OD. Or at least I think it does. lol Me thinks me is tired.

 

This is EXACTLY what mine is doing. Trans shop said I needed a engine rebuilt and I did a LOL at them. The shop didn't think it was as funny as i did. I would love to know if the sensor fixed it. Its what I was getting ready to replace.

 

I had $20 in rewards from autozone and so i just decided to go ahead and install the tranny speed sensor for $3. The old one was covered in metal shavings so when the PO rebuilt the tranny he didnt put a new sensor in. I took it on the highway and around town and it definitly runs a few hundred RPMs lower around town. Hooked it up to the code reader after driving it around all day putting 25 miles of city/highway driving i didnt have a single code come back up. I will check it in a few days and see if anything new came back, but it looks like that fixed it.