fm problem

I have a SX-828 on the bench with a strange problem with the FM radio. It picks up weak stations good enough, when I tune to a strong station, the signal strength meter pulses and bangs against the max stop. The sound is distorted in sync with the pulsation. I get a very weak stereo light when...

Hopefully there are a few techs here that can give me some direction... I have an Allied 445 receiver that has severely reduced volume (about half) on FM and FM mono only (I got it this way). Volume is normal on AM, aux, and phono. Also, there is no FM stereo light on when on FM stereo selector...