727 Shudder in Reverse, then rattle on 1-2 shift

Correct. Automatic shift valve body with a shift kit.

I have not tried manually shifting it from 1-2. The noise, so far, only appears when in Drive and it shifts automatically from 1 to 2.

Ok so when in Drive, the low/reverse band is not applied in first gear. The only time that l/r band is applied is in reverse or manually put in first gear. I had to ask that question being that it’s shuttering in drive when going to second gear, there is no band overlap that you could have been experiencing. Next thing I would do is adjust the kickdown band (second gear band). Torque to 72 inch pounds, and then how many turns to back it off depends on what ratio apply lever you are using. You said you rebuilt it yourself so I’m sure you know what ratio apply lever is in the trans. Also, is the kickdown band a flex band, or solid band? Also is there a heavy duty/reinforced band strut in the trans or is it stock?