i have a 89 735i and after and trans service it does the same thing.if i let the car wram up for a few minutes it shitfs fine.if you come up with a fix let me know but for now i will still keep looking for what is up with mine.
good luck

Thank you everyone for the great information that you share. I have bought an 88 735i that will not downshift from second to first. Here is the start to finish: Start the car and shift into R ... no problem. Back out of driveway shift to D ... no problem. Accelerate to 25 MPH no shift and no problem. Stop, hard accelerate to 35 MPH shift to second slow to stop and no down shift. Car will drive off very sluggish no slipping. Pressing selector switch on console has no effect. Shift into park and back to drive...no first gear. Shift to R and it hits like the car is revving at 3000 rpm. Idle is normal throughout tests. Turn car off and restart it, have first gear again. I have only driven car .5 mis. as I do not want to tear anything up. Tranny fluid is not burnt smelling nor brown, quite red actually. Any and all suggestions are welcome.