Interesting. Which model: Sahara, Willy, or Rubi?

I have never had an issue in either 4HA or 4HP. I did have my transmission temp spike once in 4L on a sandy/loose climb. Apparently, the automatic transmission will keep searching for the "right" gear as the wheels try to gain traction. Faced with that situation, the solution is to put it in 4L and manually select the proper gear.

Now I just keep an eye on it when climbing. Have never had another issue.

 

Rubi with 4.10 35s, I did eventually put it in 4L in manual out of necessity because of mud and spinning, I did not notice a difference in 4L manual and 4L auto. I also did not notice if when in 4H the trans was trying to change gears. I'll have to look at those next time I'm out.
I generally drive w/o TC when I'm offroading so I wonder if that has something to do with it also, like the trans wants to shift less w/o TC because its not "worried" about gaining traction. I don't know if that how that works or even makes sense.

 

It's possible the fluid is low and needs to be checked. I would also consider changing the fluid, given how hot it got.

 

When I used to take JK's off road you would get the "HotOil" warning for the transmission sometime in 4Hi. Assuming you have fluid... the issue was the torque convertor would slip like normal in 4Hi and heat things up quickly. In 4Lo the convertor was locked which resulted in much less heat being created.

 

It sounds like this issue is the same but "opposite" as that. Instead of the torque converter slipping because 4xe's don't have one, its the wet clutch slipping and when its in 4L it locks the wet clutch. I've talked to a few people that have agreed with this, but still don't know of any ways to prevent it.