This has turned into quite a nightmare.
I went back to my dealer and they ordered me a new unit. After it was put in the locator was exactly the same - end of the pointer always half a block ahead when zoomed close.
I called Pioneer and they suggested moving the antenna to the back of the carm on the rear deck, where my Sirius antenna is. When they did the test, just driving around with the cable out the window and the antenna temporarilly sticked on the back, it was fine. As soon as they glued it down and hid the antenna wire through my car, it was back the way it started.