Even in the manual they have "upgrades" and instructions on how to install a gyro and brushless kit. I have one and added the HH gyro. Once you get the new gyro set up on it, your problems should go away. Mine was doing the same thing (not quite as bad as you describe) and when I put the new gyro on it.... wa-la.. the issues disappeared.

Are you setting the heli down and plugging in the battery without moving the heli then let the lights stop flashing so the gyro can stabilize? You cannot hold the heli and plug in the battery then set it down...moving the heli right after you plug the battery in will not let the gyro stabilize also causing problems...

Hope that helps

Henry