5 minutes ago I performed this test myself on my K8. The result?Ok, so much for my stray-voltage on the switch circuit theory. Sorry I overlooked your post, Erik.
Tested what happens if you hold the manual mode button down from before turning the key to ON and then starting it with the button still pressed: It stays in 1, but won't start. (Load-reducing relay kicks in, starter doesn't turn.)
The CVT stays in 1 AND the engine starts!
So I think, based on that result, that the inititial focus should be on eliminating the possibility of an intermittent short in the switch.
Craig, the reason I mentioned PPPS failure is because having the CVT display alternate between AUTO and manual 1, 2 was the primary symptom I experienced with PPPS failure 5 years back. I agree, though, that it is not a common symptom AND my PPPS did fail as a result of water entry shorting it out.