You may want to try rev-matching when putting it back in drive. That is, bring the engine up to the approximate speed that it would normally be spinning before engaging drive. This will eliminate the burden the torque converter faces when bringing the engine back up to speed.
It shouldn't hurt the transmission per sey but it will add wear to your transmission by shifting into and out of gear which will ultimately reduce its' life expectancy as that is partially linked to shift cycles. Most modern cars will switch to a high idle when coasting with an automatic transmission and really the difference between say 700 RPM's at idle and 1,500 at high idle are going to be too small to measure in the form of fuel economy. The only factor here that I see that might be measureable is compression braking, where the car slows due to the compression cycle of the engine where each cylinder goes through a compression stroke every 2 RPM's and that translates into braking through the transmission if the torque converter and the clutches haven't disengaged. So basically what I'm saying is that if you are coasting down a long grade then you might consider shifting into neutral to reduce the compression braking, but for day to day driving the only difference that you'll likely see is a shorter TBO (time between overhaul) for your transmission.
Since we're on the topic I should mention that in California at least, and I suspect that most if not all other states have the same rule, it is illegal to drive in neutral. That being said I can't imagine that you'd ever be caught doing it unless you were stopped by a LEO and were questioned on it or offered the information to the officer. Just an FYI.
Finally, make sure that you are changing your automatic transmission fluid regularly. This is one of the most commonly overlooked bits of regular preventative maintenance items that can be really costly if ignored. I do mine religiously at 15,000 miles even though the Acura service manual requires it only every 30,000. Honda and Acura have smaller than average transmission filters and if they clog then you buy a rebuild. I'll spend the extra $ now and get it done regularly rather than have to pony up for a full rebuild before it has seen the end of its' usefull life. That is just my $0.02, so take it for what it is worth, but I've built a lot of motors and a few transmissions over the years so I know at least a little bit about what I speak.
Furrner, I agree with you on that one. With the Scan gauge it tells me when i am coasting down hill (manual trans) IN GEAR it reads like 5000mpg! Pretty much the weight of the car is moving the motor around and the fuel is cut off. With the clutch pushed in an costing in or out of gear, I am getthing 200mpg. Pretty good but fuel has to go to the motor to keep it running. With it in gear I get some braking from the motor instead of the brake pedal saving a bit of brake. Going into out of gear and coasting is pretty much not in my book. It would cost more in repairs and possible accident for not being in control of your car than you would get with the small savings in fuel. Biggest savings comes from smooth driving and not having a heavy rigth foot! LOL!
Car and Driver's current issue touched on this very same topic and reported exactly what Furrner said above, that modern (since 1990 according to the article) EFI systems completely cut off the fuel flow electronically in an automatic when the computer registers a difference between the engine RPM's and the transmission tail shaft RPM's for the given gear, in plain English, the computer recognizes that the car is coasting and shuts off the fuel delivery. This will provide the best possible fuel economy as VWJunky posted that his scan gauge shows. It also will cost you the least over all in the long term in the form of lower repair costs for both your transmission and your brakes.
Also like VWJunky points out the best fuel economy improvements are generally made by keeping your speed down and eliminating hard accelerations and braking. Remember that the old dreaded Double Nickle was enacted in response to the gas crunch of the 70's in an effort to reduce gas consumption. Like it or not it really does provide nearly the most optimal mileage results for most vehicles. Honestly the best mileage improvement I've had in the last 6 months was when the gas costs went ballistic in June and July and the average freeway speeds in Southern California dropped significantly so that the commuters would lessen their weekly gas bills. For me my average commute speed decreased from an average of about 70 MPH down to about 55 MPH and my average MPG went from around 27 up to 33 almost over night. So decrease your speed, inflate your tires, remove excess weight from your trunk, clean up your aerodynamics and coast down hill and I'm confident that your mileage will improve significantly.
When I was driving my '93 Olds Ciera through W.Va mountains I experimented with terminal speed in neutral vs. cruise control. With the cruise control set at 70, I went about 73 down the mountain; in neutral the car got up to 88 mph. Obviously compression braking was slowing the car when in gear (and on cruise control).
Did my Olds have this computer fuel cutoff you mentioned?
Do I understand you correctly that I was getting better gas mileage coasting in cruise at 73 than coasting in neutral at 88?
for a 93 Olds it could be either way. But the savings would be so small that it would not matter much. Why not just get to the top of the hill, turn off the car and push it till it rolls and jump in i would think you could get 100mph with the use of no gas!? I know that sounds crazy but in reality that would be crazy. What about the wear of your brakes (cost money and can overheat and not work at all), possible speeding ticket, possilbe school bus going down the hill full of kids at 45mph all to save a buck. I was with a guy that was able to draft a truck so close that he was able to turn off his motor and the truck draft would pull him down the highway. Of couse we were stupid and young and doing that was extreamly dangerous. If you are going to go crazy (in a good way) play with your aerodynamics, hard skinny tires. Tune your car in such a way that you can get some MPG's. Drive like a Grandma and you will be safe and sound when you get home.