Perfect Pass / Paddle Wheel

I purchased a used '05 24SSV on Friday and absolutely love the boat, but am having a problem with my speed/perfect pass. My speed is varying on both my actual speedometer and my perfect pass. I don’t know if the two are related in determining the actual speed but neither are accurate. My perfect pass will say 7 to 20 mph when at a stand still and will sometimes show 3 to 5 mph when in tow. It isn’t taking control of the speed either, though it beeps and highlights the name on the screen. It’ll beep several times during a pull as the perfect pass continues to misread the speed and bump it down and back up to where it thinks cruising speed is. I checked the paddle wheel yesterday and none of the tabs are damaged, but the wheel can slide side to side about a 1/4 of an inch either way. I don't know if this wheel is supposed to be stationary or if it is typical for them to move side to side at all? Is it related to the paddle wheel? I was under the impression the PP was correlated to a servo taking commands from the throttle linkage, but I could be wrong. Any advice, help, or direction you can give me would be highly appreciated.