While I have an AEM, I have my sensor mounted in the exhaust pipe about 5" or so from the header collector flange. With a full exhaust (dumped at axle) I have good steady readings. I also have a bung welded on a 12" extension for track use, at the same distance from the header flange. The readings on the gauge are similar to what you're experiencing. Useless. Too close to the end (atmosphere) You need to either run longer extensions, or a full exhaust (at least dumped at the axle) to get a good reading, IMO.
