The early 722.3 trannies were full of problems that caused 3-4 flaring. They were originally installed with too much clutch pack end play, the 2nd gear band had too high a friction coefficient and the B2 servo piston which is released to go into 4th caused leaking.
All these problems were repaired with technique or improved parts. A tranny as old as yours would have every reason to have leakage in its 4th gear clutch pack lipseals anyway.
As it turns out most problems such as yours can be covered up by adjusting the modulator pressure higher and finessing the shift point/vac relationship. As Ian points out the vacuum must go from 10-14inches to zero at full throttle, but there are three considerations that affect the actual vac during shift. First is the actual shift point as determined by the control pressure cable. For any given 3-4 shift the modulator pressure will be higher if the throttle is further depressed; thus if you make the shift earlier it will be done with more throttle (i.e. if you are releasing the throttle as the shift is made - due to speed - the vac goes up and pressure decreases tremendously).
The relationship of vacuum to throttle is also adjustable at the proportioning valve on injection pump. Some of the proportioning valves (probably yours) can be adjusted for the overall range (i.e. 14" to zero vrs 10" to zero).
While schmoozing the controls are an easy alternative (if you find someone who can do it - sorta like playing music by ear)the real repairs are inside with proper clutch end play, new non-leaking seals, low friction band (this allows more overall shift pressure without 2nd gear taking your teeth out) and a modified B2 servo piston which improves the shift timing.
BTW unless you brutalize the shift it will continue doing this shifting indefinitely. They did it new if set-up wrong and it doesn't hurt anything if you can adjust your shift style and let up till fully engaged.