The surge when braking - when you are almost completely stopped, is normal. The Allison downshifts when your foot is off the pedal for a little while. It took me a while to get used to this. The other problem you described happens to me when driving in city traffic. The Allison doesn't seem to handle rapid movements back and forth between the two pedals.
2003 2500HD Crew Cab 4x4, S&B Dry CAI, AirDog 100, Sinister Diesel Sump, MBRP 4" Downpipe back exhaust, Edge CTS, EFI Tuning by Idaho Rob, Iron Cross winch bumper, Badlands 12K winch, Alpine GPS, Roll n Lock, 285/70/17 Cooper STT's on H2's.