Idle on the '84-86 is programmed for 800 rpm. Attempting a higher idle speed with the stock chip will cause the idle to surge up and down. Later '87-88 chips were programmed to 880 rpm. The procedure is to put a wire jumper in the port by the engine console with the engine warmed up. This bypasses the Idle Control Valve, and then set the idle manualy to 800 rpm. You also need to make sure the micro switch on the throttle body is set correctly.
The idle dropping when the oil cap is removed is a good indication there are no vacuum leaks.
Setting the base CO level is also important.
