What is the function of the speed sensor?

Sounds like your VSS. Vehicle speed sensor. I don't have that year vehicle, but my older Prelude did the same thing.

Yes it will shift as long as the Vehicle speed sensor is working, if it isn't working you should have a check engine light on

it sound like it could be a vacuum problem. I have experienced this on cars i have worked on it usually turns out to be a vacuum problem 90 percent of the time.

if its backfiring at 60 regap the plugs and check the rotor,, if this isn't the case and taking the tranny into the mix, I'd look for a vacuum leak of some sort

is the ABS light on? the Rear Wheel Speed Sensor is a common problem. Its located on the top of the rear axle.

The "S" light flashing means the speed sensor went out. Is an easy fix. I got mine for less than $40 and it was not hard to install. As for the gears going in too slow, I dont know. Good luck.

could be the dash board speed indicator. ford routed the info for the computer thru the dash indicator

good diagnosis that is correct if the vehicle speed sensor is not working the speedo doesnt work and the trans doesnt know when to shift

you need to replace the output speed sensor..located on front of transmission..near driver's side wheel..2 pin connector..unscrews from transmission case..fairly inexpensive part..around 35-40 bucks

well i would try replaceing that sensor first it is a speed sensor and it has a lot to do with the shifting of that tranny if it dose not work yea with what you have exsplained it is probly time for a tranny but this fix is worth a try thanks kdc744