I'd like to understand more about this issue of 3-4 clutch pack burning and excessive heat with tall gears.
Starting from heat what is actually happening when the transmission spins slowly while driving? Gears are engaged, so no clutch or band should slip, TCC should be locked, what is creating that extra heat? Is it TCC staying unlocked due to some reason? Or 3-4 gear hunting and associated clutch slippage?
And regarding that 3-4 clutch pack wear, what is causing this? Excessive 3-4 gear hunting?
The powertrain has to work as one holistic system, where cam grind, converter stall, final drive ratio, transmission ratios, tire size and vehicle weight (along with intended application/use) must all be taken into account and phased in/matched so that the system functions optimally.
Excessively tall gears will stress all overdrive transmissions when in overdrive, it's not unique to the 700R4...the deeper the overdrive ratio, the more stress...the problem is lack of mechanical leverage to drive engine RPMS up sufficiently to keep line pressure/line rise at required levels in the transmission so that the overdrive clutch (in the case of the 700R4, 3-4 clutch in comb w/2-4 band). When the transmission is under-driving the engine, there's no issue as there's more than enough RPMs built rapidly to keep pressures sufficiently high to meet input torque-driven demand for pressure for the apply circuits.
For example a 2.73 final drive gear ratio is appropriately matched to a direct-drive transmission such as a TH350 or TH400 because the tallest gear in those units has a 1:1 ratio between engine speed and output speed. So when the driver accelerates in third gear, there's always enough line pressure/line pressure rise in the direct clutch apply circuit to handle accelerations while in third without the risk of slippage due to insufficient clamping force on the direct clutch.
Take that same vehicle, swap in a 700R4 and 2.73 (or 3.07 in the case of heavier vehicles) becomes dangerously too tall when in overdrive because for every one rotation of the output shaft, the engine is only making .69 rotations and the time it takes the engine to rotate once is insufficient because the final drive is too tall (ring/pinion not spinning fast enough). With taller gears the amount of time it takes to make those rotations is too slow to enable the TC/pump to spin fast enough to generate the required line pressure to feed the 3-4 clutch pack and 2-4 band apply circuits, especially upon acceleration in OD. So when the operator goes to accelerate, line pressure rise in the 3-4 clutch apply circuit is usually insufficient to maintain the required amount of clamping force on the 3-4 clutch and 4th apply servo piston to keep both holding. So each begins to slip, and slippage = rapid, runaway heat build up during the slippage episodes.
Change the ratio to something like 3.23, 3.42 or 3.73 (All factory ratios available w/the 700R4s and 4L60Es), the problem goes away because the rate of spin in terms of seconds per engine rotation drops (engine RPM rises faster) thus line pressure is built faster so there's much more volume-driven line pressure to feed the overdrive clutch hydraulic circuits, which meets demand and keeps the clutch pack (and band) applied firmly. To my knowledge, no 700R4 or 4L60E equipped vehicle came with a final drive of less than 3.07 or 3.08 and those with that tall ratio were passenger cars...F-bodies/Vettes had 3.23 or 3.42 while most half-ton trucks/suvs had 3.42 or 3.73 (Correct me if I'm wrong).
No TV cable adjustment or additional fluid volume (i.e. larger pans, etc), larger boost pressure valves, etc can solve this problem. The only way to cure it is to bring the final drive gear ratio back into 'phase' with the rest of the powertrain now that an overdrive transmission has been integrated.
The 3-4 pack is very vulnerable to begin with in the 700R4/4L60/65/70E Transmission family due to poor design coupled with too-small a feed orifice in the separator plate for the 2-3 feed and 2-3 exhaust as well as excessive clearance in the clutch pack from the factory. Too tall a final drive ratio puts it at even more risk.
Hope that helps - it's not the easiest concept to explain and I'm sure there's other folks out there who can do a much better, more succinct job that I can.