Well I had one in my shop that seem erratic so it nice to see where and what the problem is, first thing I made sure the Battery was correct, that was the 8 AA battery pack and not 8 rechargeable pack as they don't have enough power as you need a 10 in the pack. That was good and check all the batteries to see they were not low, that was fine, Next thing I did was put the sensitivity on auto and did make a little difference, but not enough and knew that souldnt be the problem, next being it too had a meter which is there first try on the Sovereign and not the best as I had many of them that I switched over to the Sunray 180 meter for many I had sold. Now if you disconnect the meter from the set up so it out of the circuit and see what happens if it is still there with that disconnected then you know the meter is OK then the next is disconnect the cable from the control box so the box is by itself, then it should run smooth and know it is in the control box as non of the extra is causing the problem as now nothing is hooked up and the control box is by itself. If it runs smooth with nothing hooked up than it has to be in the extra like the meter or coil, one thing I had seen is the connectors are the problem in some case as they are not tight or not making a good connection so any little bump it will it to act up, so make sure they are well connected as that was the problem with the one I had in my shop as it might have got wet and had a little corrosion .If it is still a problem then I would check and see if moving the cable for the coil to see if it is in the cable. Basically you probably have to eliminate one thing at a time to see where it is coming from.
There is a possibility being this original Sovereign being is 33 years old and some of the components may be dried up and not working correctly . I know I bought a original Sovereign and tried and didn't keep long as it wasn't that great and it too didn't run smooth and sold it on E-Bay, Maybe I was used to my Sovereign XS that came out by 1994 as it ran very smooth using the auto sensitivity until I learn while using it, now my sensitivity is just a little pass the auto which is max sensitivity.
One thing before I forget that foil in the control box i believe is special foil that is for electronics and if when on it touches anything on the circuit board it probably wipe out the control box .
Hope that help you find the problem and you will be back detecting.
Good Luck
Interesting.
The coil wire can be an issue.
I always tape my coil wire up the shaft a foot or so leaving enough room for coil movement.
Yes a lose coil can make noise.
Both from moving in the coils field.
And from moving in the field of interference.
As for components.
Capacitors are a problem with age.
You can easily replace the filter caps.
The large ones typically.
Or find a schematic.
Go to mouser electronics.
Get 1% caps of the same size and polarity.
Always photograph everything before you remove it.
Being certain of polarity and placement next to other components.
A solder sucking iron makes it easy.
Watch your heat soldering it back in.
Especially near any ICU's or transistors.
And for the aluminum foil.
Yes it is special.
If I remember correctly.
It's three layers.
Foil, dielectric and foil.
Maybe try cutting first a piece to exact fit.
Putting double sided sticky tape on that and applying second layer of foil.
Leaving no gaps between pieces of tape.
I believe that will shield much better.
Though I could swear the foil had a ground wire going to a ground point on the board.
I believe it was the inside layer.
Though my memory could be off on that.
Do keep the board covered as you did.
Good Luck
).