C4 Trans will not shift to 3rd

Hey all, recently rebuilt my C4 transmission using a B&M shift kit and a rebuilt kit. Car does not have 3rd gear -- Reverse works fine, shifts from 1st to 2nd fine, and then when trying to shift from 2nd to 3rd, there is what seems to be major slipping. The car still drives forward but not any more than 20-25 mph without winding the engine up.

At first, noticed that I accidentally left the vacuum modulator hose disconnected from the manifold, so attached that, and nothing. Then, pulled the valve body off to check that and everything seemed fine. When I pulled the valve body and in the pan was a decent amount of very fine metallic shavings. Today, we tried adjusting the intermediate band (1 and 3/4 turns out) and nothing, then swapped vacuum modulators, still nothing. The last thing attempted was that, according to internet advice on a Bronco forum, the throttle modulator valve (also called a spool, I guess) could have been backwards. Swapped out the pin to the B&M-supplied gold pin and reversed the throttle modulator valve and now the car is burning transmission fluid, which wasn't happening before. 

Ran out of time before I had to call it a day, so seeing if any of you have any advice. I have no clue what could be causing it to have barely any shift into third gear. It did manage to shift into 3rd a couple of times, but it's not consistent at all. Thanks in advance for any help!

Double A, M, C, O

All

Automatics

Must

Come 

Out

you did the rebuild yourself?

"a decent amount of very fine metallic shavings"

that's bad