Unfortunately that's an internal mechanical failure - one of the clutch drums has broken and so it can no longer properly engage the clutch pack. The implausible signal means that it has selected the gear and is reading input rpm but no output, because the clutch pack is slipping. The reason it works in limp mode is that the TCU isn't trying to be clever and shift smoothly by modulating the hydraulic pressure to the clutches, its simply putting full line pressure to the clutch pack which is then able to engage despite being broken.
This is probably what it looks like:
I have an Allroad with exactly the same problem. Shiny chunks in the sump, and won't move unless you un-plug the TCU.
Our sponsors have a few of these gearboxes in stock I think. Not too hard a job to swap it on an FWD model
