Sounds like your 2-3 clutch went out (very common). I personally feel that the 9 clutch setup is not as durable as a 6 clutch. The steels just get too thin and become prone to warping.
You should throw The Beast shell in there too. They're only like $50 and that's one of the common points of failure. The servo is a very good idea. I personally felt like the TCI billet ones were worth the extra money. They have the maximum amount of surface area that the casting allows, whereas the vette servos are only about half that. Of course, it totally depends on your application too, even the vette servos can be kind of unnecessary with a mostly stock rig.
If you want to use overdrive with any load, you should get a OD servo while you're doing the 2 servo. It's right there clipped on to the same pin, might as well upgrade it while you're at it. Make sure you get the circle clip all the way in, it's kind of hard to get that seal to seat far enough.
Running a billet servo with no spring will help firm up the shift from 1-2. A shift kit that bumps up the line pressure or making your own by drilling out the plate is also a good idea. Really, if you get the shifts working well, these things really won't make that much heat. I have the 24,000 GVW stacked plate cooler that B&M sells commonly, and it's really a little too much cooler for Reno about 75% of the year. I can only really get up to 200*F when it's 85 out and I'm running it hard in between stoplights. The coolers that come with a t-stat and electric fan built in are the tits for a region that has a varying summer to winter climate.
I think any kit that gives you Kolene steels and HD frictions is going to be about the same. Alto reds are awesome frictions, but they aren't really necessary in every application.
