Er ... so what? You can't fly that accurately anyway.
It's a problem because I lost marks. A couple of my exam answers were wrong (1 degree out = wrong), thanks to the inaccurate whizz-wheel. It makes little practical difference when flying, as you say... you can't fly that accurately.
Edit: I was pee'd off because I was expecting to get 100% on Nav and was rather disappointed that I didn't. I passed anyway, but I feel dirty now.
I should probably have mentioned that I have the TPS-1 with wind-arm and I suspect that this addition is the culprit.