If the transmission in it is from a 98 it's probably not bad... just isn't shifting right because it's a 98 in a 94! They made a lot of small changes internally in the transmission, and a different year transmission won't shift properly. 1993 through a build date of 1/13/95 should work as long as it's a 42RE.
The "Mall Crawler" - 1998 ZJ Grand Cherokee 5.2 V8, 5.5" LongArms, 32s, 12000lb winch & more.
When I was looking for a JY trans for my 93 I kept getting "none here" or expensive quotes. Turns out that all the 93-95 42RE are interchangeable but they have different numbers in the JY computer. I ended up going to a yard and picking a 42RE and just saying "give me that one". Make sure you get the flywheel too.
I also got a quote of like $900 and they had to ship it in. The local Pick-N-Pull has about ten 42RE sitting out there for $150 each...
alls you have to do is get a solinoid kit ... about $150 with the update for a four pin harness ... the trans is the same man,..yours is a three pin ,no big deal and while its out its sooo easy , u tube it guy