OK, I am still in a state of shock here.
I took the explorer to the local Mr. Transmission, they did a complete check of the tranny, electical and all. He asked me how long I have had an overheating problem. (It started bout the same time) He then happily told me that he was 99% sure that all I needed to do is replace my electronic coolant temp sensor.($40 from Ford) HE said it would not hurt to go ahead and change the thermostat as well.
He then asked me if I would bring it back to him after I had changed the part out so he could check it again. He wanted to make sure that it wasnt damaged from the shifting. Best of all, he is doing this FREE OF CHARGE!! I could not believe this. Ford wanted $2600 to change out the tranny and Mr. Transmission found the problem, told me what it was and did not charge me.
Hats off to Mr. Transmission.
I hope this will help others out if they have these kind of problems. My best advice is to always get a second opinion from someone else when possible.
I am still debating on if I should call Ford and let them know about this. (Give a piece of my mind

) Don't get me wrong I still like Ford Vehicles and will continue to drive them, but I will question the service dept.
If interested I, below is what he told was the problem.
OK. The PCM uses the sensor's input to help control the closed mode controlling of the fuel mixture. It also controls the torque converter clutch lockup when the engine is cold. When the car runs hot it engages the clutch, which happens to always be in 2nd gear. This in turn throws the tranny into third gear. When it does this, the RPM's are to low and it shifts back into second. If this keeps occuring it can cause serious damage to the tranny.