94 3.5L Transmission issue?

My neighbor has a 94 3.5L auto trans and she had me look at it today. It shifts fine no klunk or any abnormal noise when you shift. But when you accellerate it klunks and does not want to speed up at all. You can gas it as much as you want but it just barley creeps along. Once you finally do get it going down the road its top speed is a whopping 40mph. She said the dealer told her it might be the tranny or a speed control sensor. Anyone have this same or similar experience that could enlighten me. Thanks in advance
Matt~

Did they ever figure out the fault? I'm thinking of buying a '97 LHS with the same issue, they want $600. If it's the speed control sensor then I wouldn't mind doing the fix myself.