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They are definitly grasping for straws. They don't know what the scangauge is, so they blame it. Its a lot easier than fixing the problem correctly. This seems to be a common dealer/mechanic problem (not with the scangauge, just in general). They said it themselves, the PCM can not be flashed, so the engine can't be effected by the scangauge.
I'd probably just comply with them for now, and if the new PCM fixes the problem I'd put the scangauge back on. There is no way that it is the problem.
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