There could have been water in the capillary line. Removing the line, or loosening it from the boiler end, and then judicious heating to dry the line out could be a solution.

any ideas?

Yes. Completely remove the pressure sensing line leading to the pstat diaphragm chamber and inspect for scale. Soak the line in hot descaling solution for an hour or so and rinse well.

I doubt that replacement pstats are adjusted to the pressure you want - maybe you got lucky but I would not treat this event as a fluke. Is this a Parker pressurestat in your "old" VBM?

Some pics of the insides of your machine would be helpful - the majority of forum readers are familiar with the VBM Domobar from this model - http://www.home-barista.com/vibiemme-domobar-super-review.html onwards.

The fact that you initially "overwound" your boiler pressure gage puts little faith in any subsequent reading. That little gage needle is a pressfit onto the rotating shaft and it would seem as though you have lessened that fit, to say the least. In addition, the boiler's safety valve should have opened long before the pressure gage overextended itself.

From your description of initial warmup, it seems as though the vacuum breaker valve is NOT operating. During the initial 5-10 minutes of warmup, you should notice a water/steam mixture escaping from the valve and then a quick silence.

Now, I'm just guessing - Your original pstat was a CEME model from your description. These are not typically wired to control a heating element directly but rather through an electro-mechanical relay either within the machine's control box or external to it. This relay that is being controlled by the pstat may be tired, very tired and may have been the cause of your wild pressure fluctuations. Your new Sirai pstat is capable of direct control and could easily be wired to do this by a good repair shop.