What valve body are you using? Is it a full manual? Reverse or standard pattern? Have moved the shifter through all postions while running it on stands? I don't know of any current 727 valvebodies made that require case or pump modifications, but I'm unsure about the valvebodies used in a clutch flight application. Back in the days of the clutch/automatic hy-brid day builders were doing some strange things to make stuff work. I would swap in a known good valvebody and see what you get. With the valvebody controlling the shifting and pressure regulation in a 727 this would be the first step.
Hope this helps, Dan