I personally don't think that this has to do with the motor, but I'm not very good with Xmods electronics. I'm going to guess that the servo may be jamming or something, inhibiting the servo from recentering. But that's just a guess. Personally, I don't like the Gen1 electronics much, partially due to the servo and that it can't turn the wheel very much, so a board upgrade is a good idea.
As for the 2.4ghz board, it's mostly because of 2.4ghz board's ease of use. One thing is that it does not require crystals and I believe that you can use many more r/c's at the same time than you can with crystals. I believe that 2.4ghz boards don't require a specific transmitter to go with the receiver so you can buy any 2.4ghz board and pair it with any 2.4ghz transmitter. I think the reason why people use Mini-z's 2.4ghz board is because it's very responsive and the face that it's size is perfect for Xmods.
If you think that a 2.4ghz conversion is a bit much, a Evo Xmod's ESC or a Micro-T/DT/B board works fine as a conversion for the Gen 1.
Personally, I don't think that 2.4ghz conversion is worth the money since I don't race with a lot of people so radio interference isn't much of an issue for me. I have my own Gen 1 and I'm thinking of putting in a Micro-T ESC and servo since I already have a transmitter and it would allow me to replace that crappy Gen 1 servo.
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ಠ_ಠ I see what you did there
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