Hey, long time lurker, first time poster here. I was having almost identical problems as you with my transmission. It would "clunk" into drive and shuttle shift for the "right" gear while driving around town and the torque converter clutch wouldn't lockup if I gave it any gas on the highway. It was killing my gas mileage and I couldn't even get up a hill without it downshifting. It also felt like the power the engine made wasn't efficiently being put to the wheels. I like to take it easy on the accelerator but I expect the power to be there when I need it to merge into traffic at 75 mph. I took it to a transmission shop and they wanted $500 to maybe fix it. They then threw out the possibility of it needing a complete rebuild and mentioned the $2500-$3000 range.

I asked for a printout of what all the quote was for and took it home to do some research (I paid them for the inspection, so I don't feel bad- especially since they really didn't do anything I couldn't have done and charged me $50). Basically all they were going to do was install a new separator plate and a new valve to fix the TCC lockup valve. It's a well-known problem with this transmission. Just do a search for P1870 and 4L60E.
So I decided that for much less than $500 I would fix it myself. I did a lot of research and decided to replace the separator plate with a TransGo (it's thicker and stronger), replace both the plastic accumulator pistons with aluminum, and put in the standard TransGo SK 4L60E shift kit. I just did this two days ago (Sunday morning) and all I have to say is WOW. I had no idea how much I was missing out on. No more clunk either! When I was disassembling it, I noticed that a couple checkballs were missing, a couple checkballs were about to go through the plate, and at least one of the plastic accumulator pistons was broken (I haven't checked the other one yet).

No wonder I was having pressure problems: the fluid was probably leaking through the piston. About the only other specialty tools you'll need are a small torque wrench (the valve body must be torqued in the inch-lbs region) and a nice set of picks. I highly recommend the installation of this kit. I don't want this to sound like too much of a pitch for TransGo. I know Sonnax and I think another company make similar shift kits. At the very least you should replace the plastic pistons (the forward costs about $8 and the 1-2 accumulator costs about $3) and replace the TCC lockup valve because it's very well documented as a problem. You could also upgrade the accumulators to pinless, but I stuck with the pins. All told, I spent around $170 to install the shift kit, new accumulators, new valve body gaskets, new separator plate, the 1/4" torque wrench (cheapie but it works well), 6 quarts of Dexron VI, and the filter/pan gasket plus some time. I also got a corvette servo, but haven't had the chance to install it yet.
If there is enough interest I'll do a writeup for the installation of the shift kit. I took a ton of photos because I was beyond scared I would mess something up and completely destroy the transmission.