It's normal for the timing to jump around massively one the bts is plugged back in. As Chris rightly said, that's how the ECU controls trhe idle speed. If the revs are gunting around with the timing set, then I'd be checking idle speed settings. If idle speed is way too high or too low, or there's a sticking throttle or other air leak, the ECU will not be able to stabilise the idle with ignition timing alone - it'll have a bloody good go though, which is why the revs will hunt around.
I'm still away at the moment dude - are you going to Actiobn at the weekend? If so I can have a look there. Also be worth finding out where that chip came from so you know what spec it's for.