It seems that if I am NOT using cruise on the highway I can maintain speed without coming out of OD much easier than when using cruise (going uphill in cruise control it seems to downshift like every 6-10 seconds). Am I hallucinating ?

My '98 Sub 7.4 does the same thing. I live in the mountains and can do a better job of throttle control myself than the "cruise". It just adds too much throttle too quickly on uphills that it shifts down the tranny. So, I use it only on the flats and hills I know it will make with the "cruise" on. Hope this helps........Steve