1986 420SEL transmission adjustment for idle under load
 

Leaving aside the issues I have with fuel/air mixture (rough idle), it appears to be worst under load (in Drive), say at a traffic light stop. Idle drops to 500rpm or less, and the engine seems very strained. If I slip the transmission into Neutral, it is much better; idle rpm is then ~650-700.

Is there an adjustment on the transmission to cure this, so the vehicle doesn't feel so strained at idle? Or shouldn't I worry about it?

With fuel mixture issues I wouldn't mess with the trans. I would correct the mixture issues and I bet the straining would stop.

I could be wrong but I think idle for these V8's is like 550+/- 50 rpm. There should be a sticker under the hood above one of the headlights saying so.

my 91 420sel idles at 525 in gear and it's smooth. if the economy needle is not pegged to the left then you have a vacuum leak somewhere causing the rough idle. you can also try cleaning the idle air valve to see if it improves the idle