[supertack]

This may sound stupid, but I kinda had a hard time figuring out my defroster when I first got my 328is. I couldn't understand why when ever I pressed the defroster button, the fan speed would go to full blast. Then a board member said, just use the air up button at regular fan speed & that would defrost the windows. Done deal, & good advice. Now in your case, it almost sounds like it has something to do with the actual temp settings. It's as though the interior temp sensor doesn't like what it's getting in relation to the prescribed temp your asking it to maintain, & it's over compensating for the discrepancy. What's bizarre is, I believe the interior temp sensor is on the front of the climate control unit (little round grate), & if you've replaced that, it makes no frickin sense. Maybe someone else has had this happen, good luck.