Just had my 94Z A4 out for awhile and this started happening..when stopped at a stop light my idle would jerk around and surge... generally around 800-1100, but got up to 2000 at one point.
Only mod on the car is a cut-out which was closed the entire time.
I found that if I kept my foot on the gas while stopped, even barely, it would hold that rpm fine.
If the car was creeping along at all, it would hold the rpm.
But when completely stopped and allowed to sit for a second or two, it would begin to surge. I tried putting the car in park, surged.
It kind of seemed as if the car could not hold the idle up and the rpm was dropping down, and it would surge up to keep the car running.
I noticed my transmission slipping while on the freeway before this, got to my destination with no problems, turned the car off for about 5-10 minutes, went back on my way and the problem occured immediently at the stop light up the street.
The car also seemed to be running hotter than usual, while in traffic right after leaving my original destination it got up a little past the middle line (210).

Any thoughts?

 

Maybe your timing chain skipped a tooth (advanced)? Do you the ability to check your IAC counts? MAP?