Diagnostics w/ a mechanical oil pressure gauge is "easy". Get a 0-60 PSI mechanical (dial) gauge, short tube, and tee fitting, all 1/8" NPT.
Remove existing pressure sender, insert tube into block hole, attach tee, then new mechanical gauge and existing sender.
Operate engine. When oil pressure fluctuates observe mechanical gauge. If mechanical is good and dash fluctuates, problem is probably a bad electrical connection.
This happened on mine. Turned out to be those right angle push on electrical transducer connectors. It was snipped off, replaced w/ the correctly sized and properly attached marine ring tongue connector, retained w/ correctly sized washers, lock washers and nut.
It has been fine for over a decade.
