That is very impressive, and particularly nice that you have been able to get the new stitching working.
For your z-axis problem it sounds as though the mechanism might be broken. Backlash would mean that the stage would not move initially when you change direction (for about 80 steps), but then it should move smoothly until you change direction again. It should never move in the wrong direction and it should not jiggle. This thread Microscope v7 stage is jumping / skipping / rewinding was an extreme case with similar symptoms. I suppose if you have a high resolution system and you are doing really small movements then the motor might shake the system enough to jiggle sideways when it moves, and within the backlash range you might see small motion in the wrong direction rather than being stationary. How small are the ‘small’ steps, and is it smooth for motion in one direction or for large moves?