I have an 02 Launch. Also have the one sender for 2 guagaes, 1 being perfect pass. No problems with it "faltering" though. You are talking about the paddle wheel type, correct? As to the water, check your packing on the shaft. could need adjustment. The book states it should drip a "little", but you may be taking on more than is needed. It isn't TOO hard to replace. The guage problem is going to be a ground (multiple guages affected). Start checking every ground wire for corrosion. One thing I do with this is use a volt meter. put one side on the battery negative terminal, use the other to check your ground leads. If the contact is good, should read less than 1 VDC.
Jamie Warwick
Rowlett Texas
2002 Supra Launch 22