NAH45212,
You have torque converter clutch shudder. Absolutely! You are describing the exact symtoms, particularly the part about it goes away when you step on the gas. You feel like you are going over a long row of those tiny little speed bumps, right, and it only happens at light to moderate throttle. As soon as you get on the gas harder, it stops.
Basically, the clutch surfaces on your stock lock up torque converter are shot. This is a known defect on all AOD-Es from 94 through 98. Ford published a TSB about it. But since it usually only happens after 60K or 70K miles, no warranty replacement! Only permanent cure is to replace your torque converter.
A short term fix is available from LubeGard (LubeGuard?). Very small tube of friction modifier that you add to your tranny fluid. It's called Dr. Tranny Instant Shudder Fixx (no lie, with two "x"s in fixx). It works for several thousand miles or so, but then the shudder eventually comes back. You can add another tube then, but in the long run a new torque converter is in your future.
I found a tranny shop that would sell me a tube, but most don't want to, since it loses business for them! You can buy it directly from LubeGard's web site. Just do a Google search.
Ben there, done exactly this, with my 95.