I just finished rebuilding a 4l60e out of my buddy's 98 z71, what i found is the only thing that can cause loss of reverse and overdrive is a busted reaction sunn shell. this is a very common weakpoint in these and it should have been a recall. it is about a hundred dollar part for the new heat treated model. but it is a very hard fix, deep inside the tranny. but i am pretty sure it is the cause. andyou dont have to do anything for it to go bad. if your band does not release it will strip out the sunshell everytime .like i said i just rebuilty my freinds so if you have any questions just ask