727 slipping

How many quarts of the new ATF went in? Was the unit and convertor dry when you started it?
If it were me, aside from taking a couple pressure readings, I'd drain it, drain the convertor, and stick some Type F fluid in it. Flaring on the upshift is not a sign everything is toast. Especially when you just had a good unit, and then replaced the valve body. I'm leaning towards a fluid compatibility issue which would affect the way the valve body does it's job, and the way the friction parts interact.