Mike...according to Chevrolet Motor Division, you can tow in DRIVE(D). You may want to shift the transmission to THIRD(3)or, if necessary, a lower gear selection if the transmission shifts too often (e.g.,under heavy loads and/or hilly conditions).
The "Tow/haul" selection is designed to be most effective when the vehicle and trailer combined weight is at least 75% of the vehicle's Gross Combined Weight(GCWR). Tow/haul is most useful under the following driving conditions:
a) When pulling a heavy trailer or a large or
heavy load through rolling terrain.
b) When pulling a heavy trailer or a large or
heavy load in stop and go traffic.
c) When pulling a heavy trailer or a large or
heavy load in busy parking lots where
improved low speed control of the vehicle is
desired.
Operating the vehicle in tow/haul when lightly loaded or with no trailer at all will not cause damage. However, there is no benefit to the selection of tow/haul when the vehicle is unloaded. Tow/haul is recommended only when pulling a heavy trailer or a large or heavy load.
Regards,
Gary Cooke