Did my 727 just die on me?

find a local converter shop to rebuild it, not costly at all. Band broke, is it stock, is the apply lever stock, is the base pressure turned up from stock?
Open it up, and show us what it looks like. Sounds like its just the front band, which would make it do what you described, rev up first, let off, and it upshifts to 3rd. You got the governor pressure up, let off the throttle, drops the throttle pressure, and it shifts into 3rd.