Indeed, the torque converter being locked up would cause shifts to be hard like that, but I'm curious as to why it stays locked up all the time, but you can still start the car out in from a stopped position.
Only thing I can think of that would cause that would be the solenoid is sticking open/closed to enable the lockup feature of the TCC.
It says the torque converter clutch is engaged but the car still starts fine and doesn't stall - only shifts hard when it'* going. A friend used his diagnostic tool - I don't have the code with me but he wrote it all down. I can call him later and get it. I have a handheld diag tool I can try.
Could it be a dirty filter/low fluid pressure do you think?
Changing the filter, fluid and installing a low cost shift kit have all been methods for a long term bandaid on many of the shift problems you are experiencing. I had the same problem you are describing at 90k miles. I installed the shift kit, replaced the filter and upgraded the fluid to DEXRON XI. I am now at 182k miles and tranny still working good.