My son's '96 recently had a torque converter not locking problem. Went on for a while. I had read on here that the brake light switch could be the culprit. He had recently changed boosters. Adjusted the switch, now it works fine!Brake lights worked normal, before and after. Go figure.
Two grand RPM at 50 MPH is excessive, with stock gearing. All four of ours will do 2k at 65MPH. It does sound like the TC is not locking. Not good for long-term life for the tranny, as a locked-up TC will generate virtually no heat, and one that is slipping is a contributor.
The surging could be unrelated, as in a faulty TPS, OR a faulty TPS could be preventing the TC from locking. There are a few recent threads on checking the TPS, a good place to start.