Wow, you really lack people skills don't you. I'm shocked that someone with your extensive experience isn't familiar with how to check transmission fluid levels in an A4LD...
FYI in the troubleshooting sections of both the Ford and ATSG manuals the following are listed under the sections regarding no/delayed engagement: plugged filter, sticking valves in the valve body (contaminated fluid or loose bolts which results in an internal leak), damaged manual linkage, improper oil level (you already checked), low line pressure (could be caused by plugged filter), then you get into internal wear/damage such as a damaged pump, forward clutch support seals worn, forward clutch assembly damaged causing internal leaks.
Internal leaks cause a reduction in pressure which results in the clutches not applying properly. This will burn the fluid because there is slippage in the clutch packs. If enough slippage and burning has occurred the clutch plates may be damaged needing replacement. If they aren't too fried you can save the transmission if you figure out why your internal pressure is too low.
If the transmission isn't cooked and you decide to fix it, there are two valve body improvement/shift kits available that include mods done to increase line pressure and reduce overlap in the shifts to minimize further wear. Glacier has a VB rebuild thread where he very nicely illustrates how to rebuild an A4LD VB with these modifications. I followed his thread with I rebuilt mine and I like how it shifts now.
It makes sense to change the fluid and filter and to adjust the bands, it is the cheapest way to find out if you should stick a fork in it and call it done. I realize that not everyone will replace a transmission and may want to try to get another couple years out of before retiring an old vehicle. Up to you as the owner to decide how you want to play it.
Oh, one other thing is that mechanics/owners sometimes replace the filter with the 2 wheel drive one which has a shorter pick-up than the 4 wheel drive one. That will act like it doesn't have the proper fluid levels causing it to not engage or loose engagement as the fluid sloshes in the pan. That seems unlikely in this case but who knows...
Enjoy. I will answer questions if you directly ask me. I don't mind looking up things in the manuals for you. Actually, I will send you a pdf of the ATSG manual if you PM me your email address.
FIND, you and I are done our conversation in this thread. No hard feelings on this end. We're all here to help each other out.
