After I level and wish to climb or descend, I switch off alt hold and click on the pitch/turn controller to est a des or clm.  I get no response from the aircraft and wind up using the trim on the yoke.
The only time I have that happen is if I turn off the ELEV paddle on the A/P.

Maybe you need to do a reinstall/repair. Run the 727-100 installer, select repair, then do the same for the 727-200.

Mark