904 kickdown problems

That's a good starting point for the adjustment. Since it's not shifting until you let off back off the adjustment a little at a time until it shifts into 2nd at the speed you like. That should correct the delayed shift into 2nd but it's probably going to compound the early shift into 3rd problem. That sounds like a problem in the 2 to 3 shift valve circuit. Possibly a weak or broken spring. To fix it you'll have to take the valve body apart and find out what happened and repair it. Or if it shifts good and firm into 2nd and 3rd you can leave it the way it is (after you get the kickdown adjusted where you like it) and just manually shift it into 3rd at the speed you want. Do you know what brand shift kit was installed? I ask because I've seen problems with some shift kits actually causing improper shift speeds like yours has. I once used a Mopar perf. kit (made for Mopar by Turbo-Action) that caused that to happen. I then took it out and put in a Trans-go kit and it worked great. Since then I only use Trans-go kits.