I would think that a slight oscillation would be acceptable. What I see after closed loop is a big swing from say 100 to 800mv and the iac count is 0 at idle. It leads me to believe that there is a vacuum leak at the bottom of the intake manifold which is the only thing I haven't checked. I squirted carb cleaner around the top of the manifold edges and there was no change. The old sbc's when they would leak it would be able to detect this as they had a cast iron intake and when the gaskets wore out they would leak at the top also.
I would hate to have to pull the intake just to find out it was something else.