jerking 

is your air filter clean? and is the fuel rail at the correct pressure?? sounds like a "running rough" problem to me, from what you describe

Thanks L, I'll look into that, tho I think the filter is fine. Should be easy enough to check the fuel rail pressure. I plan on changing the HT leads and dist cap as these seem to be original. That might make a difference. D

Hi Donal Did you resolve this problem. My '96 850 has the same symptoms and changing the leads and distributor cap made no difference. How do you check the fuel rail pressure? Regards David

Is the engine cutting out/misfiring, or is it just difficult to drive it smoothly? If the latter, an engine and/or gearbox mounting could be soft or broken. John

Well, I did some work on the car today. Discovered: wrong plug gaps, distributor cap and rotor badly corroded, and dirty air filter. Went to local Volvo dealer - told me that they don't stock 850/V70 parts - "they are too old". So I won't be going there again. Usually get parts from PartsforVolvos online anyway. Got the filter from a local parts store. So, I cleaned up the cap and the rotor and set the plugs. Replaced the filter. The engine runs as sweet as ever, absolutely no misfiring and revs freely. However the jerking is still there, mostly vague, but sometimes very noticeable. Fuel economy is average for this model, as I get around 27mpg -and thats for mostly around town driving as I can get 30mpg on a run. The plugs will need to be changed anyway. They are by Denso, and I don't think these are recommended for this car. Having said that, there were in good condition, no black or oily deposits, so it seems that there's a lot of life left in the motor yet. A new distributor cap, rotor and plugs could make a difference, however I still think it could be mechanical. Need to get someone who really knows what they are doing to have a look at the inner cv joint on the driver side. I will eventually solve this problem!

slack 

it could be the driveshafts. jack one side up at a time, put it in gear and run the engine. you may hear the loise and determine which side it is. alot of the 850/v/s70`s do this. good luck. post back of your findings

Thanks L, I am almost certain that it is a driveshaft problem. I'll get my mechanic to take a closer look at it. If it is the problem, hopefully I can find one thats reasonably priced somewhere.