01 bmw 325i is not shifting before redline. Under moderate acceleration the transmission is running the engine all the way to redline before it shifts. i know it is not the transmission its self but some kind of controller instead. If someone could point me to the controller and how to go about repairing it would be greatly appreciated.

Basically it will slip more under power and harder loads like up steeper hills. and so on.

No, Your thermostat has several purposes. Mainly to get your engine up to operating temperature so your engine operates on your computer. When the engine is cold, It's in a closed loop and runs rich and uses more gas. The thermostat also helps with your car interior heat in the winter. Never remove it, you will have lots of side effects.
As far as a transmission not shifting, I would need to know the year model and make. Odds are your transmission is electronic shift with a signal from your car's computer. You should have a check engine light on.

Not driving a corvette? Just kidding. More details are important. How slow is your acceleration? Is it 0-60 in 8 seconds, or 20 seconds? What is redline on your car? If redline is 5K then 4000 is a good responsible shift point. If redline is 8K then shifting at 4000 is probably robbing your engine of it's torque and horsepower band. I believe the GTS model has an 8K RPM redline, the GT may be lower, but in that case, shifting at 4K is too soon for strong acceleration. Your Tachometer should have redline clearly marked. For responsible use, stay below that, maybe 10-20%. For economy stay further still, but for power you need to let the engine use it's RPMS, especially smaller and fewer cylinder engines usually don't make their power until they are half way through the RPM range and above.

Are you sure you use the right type of fluid, and have you let it warm up and checked the level with the engine running?
I would only use the recommended oil suggested by BMW.
http://www.redlinemotive.com/replacement/bmw/atfluid.asp

Try manually shifting it?
Also, is there any chance you disconnected a wire or hose to the transmission valve body when you had the pan off?
Or any chance you got some dirt inside?

on the drivers side of the transmission under the car is a plug similar to a rear end in the older rear wheel drive cars bmw has
a lifetime tranny fluid setup so take out the plug and fluid should drip out its right behind the shifter cable if it dosent drip out youll need a pump to put it in you can get these at advance auto

Transmission will never hold the engine back if it is going through the gears properly.If it gets into high gear, eventually the engine will reach "redline" if you stay into it long enough. ("redline" for any engine is the point at which it cannot run any faster without harming itself.) DO NOT confuse that with proper shift points which should happen just before you reach max torque which happens way before you reach "redline" at which point you are way past the torque peak of the engine, and making no usable torque or horsepower. An example of this is a race engine with a max rpm limit of 10,000rpm.("redline") Depending upon the torque curve (determined by compression, stroke and type of cam grind) you would likely be shifting gears at about 7500 to 8500RPM not at 10,000.
Therefore, your shift points are like climbing a ladder. you get just so high and though there are more steps, you will fall off if you go there. Each time you shift, you are putting the rpms back into the usable power band, till you reach the next step, then start over again. If your trans shifts early the engine will lug and labor. shifting too late and it will quickly reach "redline" and self destruct or go "flat". In a conversion, you need to make sure that the electronics that control shift points are working within the usable torque range.
OR install a manual valve body and shifter and control it like a stick shift car, using your brain as the computer and a tach to tell you where you are.

I would run some engine diagnostic tests to determine if it is an engine problem. Then I would aim to look at the transmission system. This also involves looking into the transmission's computer. You need to take it to a shop that has a scan tool that can scan the transmission control system. A lot of the BMW have advanved logic in the computer and the average shop will not have the tool. You will probably have to take it to a bimmer dealer.

With normal acceleration the 1st to second shift point should be around 2500-3000 rpm. Most of your shifts under moderate acceleration will take place at this same point or when there a light load on the transmission. Under hard acceleration the RPMs will climp higher due to increased power needs and the computer will shift when less power is needed or the RPMs climb to an unsafe speed say5000-6000rpms (depending on where yours redlines). Also going up a steep hill will raise the RPMs higher and goind down a hill will cause a faster shift at lower RPMs. These can always be altered by an individual owner by adjusting shift points, using performance parts and if you have problems (low tranny fluid/trans issues). Your trans RPMS are fine and will vary depening on how your foot accelerates. The shift pattern should be the same every time you drive slow/medium/fast/, look for changes in those patterns you will also catch a problem early.

the transmissino is slippin id try to replace autmatic clutch or check fluids