The flashing OD light is a sign that something is wrong.... left unattended, transmission problems have a way of snowballing.... At the time that the light is flashing, the transmission goes into what might be considered a "fail safe" mode. Line pressure maxes out in an attempt to keep clutches from slipping (hence the harsh shift feel) and the PCM (bless it's niave little heart) firmly believes that the owner is going to say "Uh-oh... better get that checked".
Without knowing which trans it is, total miles on the car, how many miles has it been driven "hurtin'"... codes... maybe some pessure and "what gears do I have" kinds of testing.. it's a crap shoot to come up with an answer that really means anything.. Is the concern very, very intermittent - or does it happen very regularly? So many questions, I know... but a good diag needs to have them asked and answered.
Occasionally, we see these kinds of things as an electrical concern... more often than not, they are mechanical or hydraulic problems. If it is an internal problem, the condition of the rest of the trans needs to be considered... If it's getting long in the tooth, the wise choice might be a rebuilt.... If the trans has a lot of miles, going in and fixing only the obvious problem could leave an owner with a ticking time bomb on his hands.
FWIW.... on both the 5R55 and the 4R70, I'd have to say that I see more direct clutch failures than anything else.
A good trans tech will start with fluid level and condition... a code scan... and (hopefully the trans will be acting up for this part) a road test - he'll be checking what lever positions work as they should.... whether there is engine braking when it should happen... upshift and downshift points. This part can be tough to describe... I don't know what I'm looking for.... but when I find it, I'll know.... Pressure testing can be very important as well.... Using this info, the appropriate band/clutch apply charts... a savvy trans guy should be able to nail the cause of the failure 90% of the time.
Not the answer you're looking for, I know... but the automatic trans is a pretty complex beast...
FWIW, the only "rebuild" kits that I know of come only with the fiber and steel plates and all the "soft" parts (seals, gaskets sealing rings...) and might not contain what it is you actually need..
Afterthought... I've heard of worn servo bores in the 5R55 giving grief... Haven't come across one myself, but there are aftermarket kits available to repair this condition.