Ok, so thanks for all the help. Posting here for resolution notice.
Anyhow, I fortunately found a very reputable tranny guy in Burbank - so Cali's can contact me for referral. By the time I got it to him it had just started to do some intermittent Check Transmission status, but no Engine light. Unfortunately I did not write down the codes to remember, but you see enough of the symptoms posted earlier.
He wasn't sure what was up, after running scope tests, he said the solenoid seemed to be working fine. So he felt he should attack the valve body. Time to drop the pan and go to work. Anyhow, he called and said that he got the VB all out and unfortunately, no broken springs. So maybe somehow it was the solenoid. I told him that since he was in there, and the labor he was charging is set, do the Transgo shift kit rebuild too. So there we go, new valve body rebuild and solenoid pack, lets hope its solved.
When I picked it up, he told me that when he went to pull the original spring - didnt say which one - it 'crumbled' in his fingers. So looks like it was valve body issue all along. We are still not sure the solenoid was bad, but hey, like I told him we are in there, no time to skimp since the track record on originals is so bad. I also asked him what it looked like in the pan. He said the fluid was bright red, and only a small amount of metal frags was on the magnet - most likely normal wear short of the hard shift recently.
Don't really have enough time on it yet, since reset about 1 hour time, but it is smooth as silk again. So if you are researching definitely look to the valve body to get things going. Thanks again for all the help on this.
^)