I love a happy ending.
I'll eventually check the comtinuity and resistance of all the wires and find out what was actually causing that. My guess is either the CTS, O2 sensor or the potentiometer on the fuel distributor. It wasnt the DPR since the idle went to like 2500 when i disconnected it and i was able to get a reading with the test harness. It would be nearly impossible for a knock sensor wire to go bad since those are so damn thick. These things are technically complexly simple. Not very much that controls the engine. I'm still going to replace the fuel distributor when it gets here and then do a final tune on it. Then we might start on the body and the rest of the interior. Headliner was jus done.
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my '91 GLi had the same issue. solved it by getting the T-body idle stop/ idle switch perfectly adjusted with a feeler gauge. my car idles perfectly, but if i move the idle switch even 1/2a mm it will get that surging idle. makes me wonder if my harness has the same issue. let me know what you find when you test your old harness.
I think we might have found the issue in the harness. I think. I have continuity between the CTS wires, O2 sensor wires, DPR wires but NOT the ISV. Now, the only thing is, the ISV has a fuse on the fuse panel. Does the ISV run to the fuse panel before going back or what? I don't have the patience to figure it out nor do I care so I will jsut make myself feel like that was the issue.
Anyways, I replaced the fuel distributor and intake tube.
Pretty sure one of the two is either from a Passat or regular CIS-e.