Mr. Steele, The cruise control system on my wife's '86 Taurus "surges", or "pulses" with what seems to be an on-off, on-off, action. This is on flat road driving. The vacuum lines seem OK, not hard or cracked. I have replaced the Speed Control Servo with one out of a junk yard and put in new on-off and control switches in the steering column but the problem remains.
I think the vacuum dump valve on the brake pedal arm is working and adjusted correctly. There is a T shaped check valve in the vacuum line mounted by the Servo that Ford doesn't think could be the problem. They won't help any more than saying, "bring the car in". What about the Vehicle Speed Sensor?
There are many possible causes to a surge condition in your cruise control system. The activation of the cruise control servo is actually controlled by the ECA (Engine Control Assembly) which uses various inputs to control vehicle speed. The ECA is the main brain that also controls engine functions.
A technician will first go over the basics, just as you have, by checking for a sufficient vacuum supply, proper adjustments, and eliminating any binding linkage. Then it gets a little more technical.
The next step would be checking for trouble codes stored in the computer's memory, and then performing various voltage and resistance tests on the system. Yes, an erratic VSS (Vehicle Speed Sensor) signal is definitely a possible cause to a surge condition, but Ford has had a number of hard to diagnose surge complaints corrected with the replacement of the TPS (Throttle Position Sensor) which provides another important signal to the ECA. Remember, there are many possibilities.