When it is just idling and I turn the wheel just a little the rpms will go down for a few seconds then back up. Is it supposed to do this, or is it normal?
For safety concerns. Picture having been on the freeway cruisin for some time at night. You hit the off-ramp and toss it into neutral while negotiating a sweeping turn as you slow down. Then the motor seems like it wants to stall (load from PS, brake lights, perhaps your fan kicked back on now that it is below the speed threshold, etc). Not good.
The elevated 'rolling idle' is a good thing just for this.