Speedo Problems

I have a 1994, K1500 XC, 4X4, 5.7L, HD NV4500 MT, my speedo is starting to act funny. For about the last 3 months when ever I set my cruise control it will jump 10-15mph and when ever my truck slows down or speeds up with the cruise control it starts to jump around. Now every so often when I shift from 2nd to 3rd gear it will jump about 40mph then come back down to where it is suppose to be. Any suggestion on what this problem could be. I was wondering if it could be the vehicle speed sensor, but wouldn't that cause the problem all of the time?

Also wondering if anyone has put seats from a '96 or newer in an older truck, the drivers side on my seat is the 40 and the drivers side on the newer trucks is the 60.

Thanks in advance.