Marc,
No. The flare/slipping can occur without causing the O/D light to blink and you will not get any error codes.
The transmission has sensors that detect the speed of certain planetary gear sets and can determine when a gear has been engaged or disengaged. It appears that there can be a significant and noticable amount of slip during shifts without triggering an error.
The main problems with the transmission are with the valvebody. That is the electronicly controlled hydraulic brains for the transmission. Electronicly controlled solenoids operate hydraulic valces in the valve body to shift gears. Sometimes the piston shaped valves get stuck and cause a delay shifting out of 2nd gear. Until the transission sensors recognizes that 2nd gear has been released, 3rd gear will not engage. During that delay the transmission is slipping because of the reduced hydraulic pressure because the transmission is trying to release second gear. This sticking also causes the solenoids to wear our or become weak making the shifts even slower and increasing the flare/slipping
Another problem common to our transmissions is that the valvebody gasket is prone to leaking which reduces hydraulic pressure and can also cause the shift flare. This problem is typically caused by the valvebody mating surface not being perfectly flat, and the gasket cannot seal perfectly over such a large area.
If the shift flare has not damaged the clutches and bands in the transmission, then simply replacing the valvebody and the solenoids will usually fix the problem. Replacing just the solenoids without the valvebody is only a temporary cure since the sticking valves in the valvebody will eventually wear out the new solenoids. The valvebody should always be replaced since it is the source of the problem either the vavles are sticking or the gasket is leaking.
...Rich
