Q: FNR5 Transmission skipping 2nd and 3rd gears.

I had 2 codes to start with. P0757 and P0766. I drained the fluid and dropped the pan to get at the solenoids. The fluid definitely had a burnt smell to it. I'd say it was about a 4 out of 10 smell, 10 being "gag me" status. Inside the pan I noticed the last person who worked in there used RTV to seal it back up. There were pieces of it in the pan. The magnet had tiny shavings, looked almost like a ball of fuzz sitting there, but there were no "chunks" of metal. I replaced the 2 solenoids, cleaned up the mess, and put it all back together. I reset the KAM and took a test drive. I did not get a CEL but it was still sticking in first until about 40 mph then it seemed like it jumped clear to 4th and then activated limp-in mode. Same as it was doing before. Could it be RTV pieces in the valve body? Burnt 3rd and 4th clutches? I also checked the pressure control solenoid and the trans pressure switch per some guidelines I found online, they both seemed to check out fine.

My car has 130000 miles.
My car has an automatic transmission.