here is the exact problem your having. I had the exact same thing happen on my trans, drove it like that for about a year and a half lol. i changed the valve body, adjusted both bands and changed the fluid with no luck. but that was before i found this info.
Got this word for word off Alldata under front servo operation, so im guessing replace the plunger if you can replace it alone. could have something to do with the apply lever also. you could also try what lanky said. but i bet the piston is cracked if these ones are plastic also like the accumulator piston is.
FRONT SERVO OPERATION
The application of the piston is accomplished by applying pressure between the two lands of the piston. The pressure acts against the larger lower land to push the piston downward, allowing the piston rod to extend though its guide against the apply lever. Release of the servo at the 2-3 upshift is accomplished by a combination of spring and line pressure, acting on the bottom of the larger land of the piston. The small piston is used to cushion the application of the band by bleeding oil through a small orifice in the larger piston. The release timing of the kickdown servo is very important to obtain a smooth but firm shift. The release has to be very quick, just as the front clutch application is taking place. Otherwise, engine runaway or a shift hesitation will occur. To accomplish this, the band retains its holding capacity until the front clutch is applied, giving a small amount of overlap between them.
