98 Se Tranny

98 Contour SE 2.5 L 120K Miles - Transmission holds first gear and will not shift into second unless I let up on the accelerator. Then it shifts into second. No problems with the 2-3 shift. Also, the O/D light flashes. The transmission fluid has been changed regularly and the fluid is bright red with no burnt smell. I am getting a DTC that states second gear ratio incorrect. I presume the reason for this code is that the command gear is second but the transmission is still in first. I have an Auto-Tap and can monitor the engine and transmission, the shift solenoids appear to be operating properly and there is no indication of any other problems in the transmission via the Auto-Tap. Does anyone have any ideas of what the problem may be? Also I can monitor the Transmission Fluid temperature which eventually gets up to the temperature of the engine coolant (198 deg.) It was about 95 deg here when the engine coolant was running 198. Does anyone know what the trans temperature should be?