Overdrive on these AW series automatics isn't an add-on unit like the M46 overdrive... it's internal, just a 4th gear. It's simply switched on by an electric solenoid, not engaged by simply the position of a mechanically operated hydraulic valve, as all the other gears are. The solenoid just opens up an additional flow path to allow it to activate that clutch once the conditions in the trans allow it (typically, high enough road speed- it needs to be going 35-40 mph for it to engage).
In this case, it could be more serious than just a solenoid (which is what I would have suggested it needs). A fluid flush will help if the fluid is dirty, burnt, or old. The best method is described in the 700/900 FAQ:
take off the top trans cooler steel line at the radiator, and attach a hose to the radiator fitting. Allow that to drain into a bucket or gallon jug- refill the trans through the dipstick tube as you go. After 6-10 quarts, you should get clean fluid through the system. This flushes out the fluid in the torque converter, which you won't get even if you drop the pan. The "filter" in the pan is just a screen- it does not need to be changed. Ever. But clean fluid is a must.
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Rob Bareiss, New London CT ::: '87 244DL/M47- 221K, 88 744GLE- 202K, 91 244 181K, 88 244GL 145K