I believe the most of the time this is caused by the lower speedo cable.  It
can lose the circlip and move in and out of the square hole in the dust cap
in the center of the wheel.  Over time this causes the square drive on the
end of the cable to round out and some times causes the fluttering problem.
This is easy to check, and not expensive to fix.  I would lube up all of the
cables too (LPS 2 would work great for this) and the back of the speedo.
It could possibly be a speedo problem, but then you are talking about getting
another used one, or spending money on getting yours repaired (new they are
around $150.).
Hope this helps.

Ken Wilford
http://www.vanagain.com
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