Using this pic from
@D Cluley, I would recommend checking this first, as you need do all of this to change the VB anyway.
Disconnect the shift cable (lime color) and rotate the lever arms out of the way. See if the shift valve moves freely, you should feel some spring pressure behind it, too.
Presumably the pivot shaft for the levers is removable in order to remove the VB, if you can remove it, the shift valve might clear the panrail with the VB in place.
The valves in the pic above look to be steel, so any scoring might only be in the VB bore?
Also verify that all of the circular edges on the valve are fairly sharp. It's counter-intuitive for sharp edges, as we usually like nice soft chamfers.
But sharp edges prevent a spec of debris from lodging in a chamfer. (I learned this from some experts on a modern AT trans, but I presume sharp edges are a universal rule?)
So if this problem that occurred in the past was determined to be shift-valve related, and fixed by a well-meaning 'blueprinter', who saw fit to remove those sharp edges to fix the problem - there might be the same problem but for a different root cause. Especially if there's scoring in the bores, which gives a larger debris-trap if the valve edges have been softened. (but if so - VERIFY if sharp edges were in use 50+ years ago!)
As
@Davea Lux said:
there is a test port on the tail shaft housing to check governor pressure. At idle it should read about 2psi. With the rear wheels off the ground, the pressure should increase about 10psi for each 10 mph.
The fact that you cannot shift the lever into 1st above a certain road speed makes me wonder if there's some excessive pressure (or cross-talk) somehow blocking the valve until that pressure drops below a threshold. You should be able to shift the lever into 1 at any speed, but the trans will not perform the shift until it's possible.
And it's entirely possible you have 2 problems here. If the trans was rebuilt at a 'service' shop as you mentioned - maybe they weren't savvy to find all the problems.
As economist Thomas Sowell once said - 'They found what they were looking for, why would they look any deeper?'