I recently bought a RC46 2001. and speedometer does weird thing: while driving, it starts droping, for example if driving 80kmh, it tries to show 80 but jumps between 40 and 60 up and down all the time nevertheless the speed is constant. Same at all speeds, but more variations are at lower speeds, less variations at higher speeds.
Is this a problem with gearbox speed sensor?
Except that, the bike is perfect, very pleased with buy, done 3000 km in little more than a month already 🥰
Your diagnosis sounds correct and I had the same happen on my 98. There is plastic coupler that slips onto the speed sensor shaft and engages with the sprocket nut. If that wears or gets damaged then the speed sensor will give erratic readings. Its a very common Honda part and not expensive. When you refit the speed sensor to the sprocket cover, make sure the coupler slips nicely over the nut, if not it gets damaged when you tighten the bolts.