[Steeveedee]

The original setup was ported vacuum, and it didn't overheat at idle when new. I'm not going to chase that argument rabbit around, just pointing out a fact. In general, when a vehicle gets hot at idle and not when moving, it is air flow through the radiator. That is all that is different at low speeds, like say, 35 MPH. Of course once the engine starts to work harder at higher speeds, that can change. How hot is the coolant when you are driving on the road, and how long does it take to cool off once you are rolling?

After re-reading your OP, I'm going to say that the difference in idle speeds in and out of gear is also going to contribute. Not all, of course, since it just doesn't get as hot in neutral.

As a temporary measure, as hes been mentioned, advance the timing so that you can reduce the idle speed. You're working the converter at that high an idle, and that will heat the trans and the engine. You may have to go to a higher stall speed converter to completely address the issue. It's obvious that the convertor isn't all of the problem, since it doesn't cool all the way down when you put it in neutral.