With O/D off you have more 'pulling' power. You're supposed to drive with it off on hilly and mountaineous roads. If you get on the highway and are cruising, you should turn O/D on. O/D simply stops the car from shifting between 3rd and 4th gear as much and provides engine braking for downhills. If you want to strain your tranny, turn it on when driving through those hills
Ever seen your gas mileage drop when you're having to push your car harder to get up the hill? I get better gas mileage keeping it off on those roads cause it's running at higher RPMs.