With the OD off, you have 1 less gear to work with (essentially using only 3 gears). At highway speeds, 1 less gear means higher RPM's. Higher RPM's means more gas used.
The higher the rpms the more gas used I believe, but I am not 100% sure.
How high is "safe" to let the rpms get while cruising. Obviously O/D off is the lowest, but at like 35mph and about 2000-2500 rpms in 2nd or 45-50 same rpms in 3rd is that ok to cruise at for a period of time or is is bad for the trans or engine?
OD on is better for fuel economy. From what I understand the main reason for being able to turn it off is so when you're cruising around town at 30-35ish, it won't shift in an out of OD.
Ford wouldnt default the car (OD on) if thats what would deliver worse mileage. If having the fourth gear would hurt mileage, why spend the extra money for a four speed?
At this stage, it sounds like you should just start the car, throw it in go mode and forget about it.
The only useful time for that button is when climbing a mountain pass and you don't want to shift into 4th. Some might say it can be used for towing too, but you shouldn't be towing anything that big with a mustang!
The auto manufactures could have saved us 30 years of people worrying about O/D buttons if they had just never used them to begin with and had just called it 4th gear instead.
Maybe in the early days of O/D automatics, transmissions were too dumb to shift to a lower gear or unlock the converter if the load was too high, but any recent transmission should be smart enough to know when to use O/D and when not too - even towing or going up and down mountains.
O/D doesn't help much on mileage below 45 mph or so. I usually leave it off on my wifes Escape & daughters Taurus until about 45 mph.
That last shift from 3rd to 4th over and over in city driving, unnecessarily raises trans temps & increases wear.