Your idea is possible as is just about anything of course. By "shift it through the gears", you mean start it in 1, then shift to 2, then shift to D and it will shift into each gear manually as you shift it? Yes, I know that sounds like an idiotic question but it's merely meant to clarify. So, what happens when you shift into D from 2? Does it go into 3rd and then overdrive or jump right to overdrive? Or, do you have the OD switch off when "shifting through" the gears so it will only shift into 3rd until you hit the OD button (therefore THEN allowing it to shift into OD as it should).
If it shifts correctly as described above, I would look at the neutral safety switch. If the speedo seems accurate with no bounces then the rear VSS is probably ok but that would be another possibility. And, as weird as it sounds, check your cab light on top of the rear of the cab (3rd brake light). Sometimes when they're burnt out, they cause issues with the trans due to incorrect signals to pcm and such. Guys on here have had some weird stories about that damn light.
Outside of that, short of putting a scan tool on it and checking for codes AND OF COURSE, doing a basic visual like checking fuses (ALL FUSES inside cab fuse box and under engine compartment), checking wiring for shorts or bad wiring and the plug ins for bad pins or bent pins or bad connections or not being FULLY plugged in or seated, OR...the shift cable, shift lever, or connections on the trans are wore out (therefore causing the incorrect position on the transmission for the correct detent and/or shift position) I don't have many other suggestions.
Last edited by eldridge201; 10-22-2012 at 04:57 AM.