Steering oscillation is an inherent characteristic of all force feedback signal output, and can become more apparent with more powerful wheel bases with low internal resistance, because the rapid response of the motor and its inertia causes an 'overshoot', which is then 'over-corrected', ultimately resulting in a feedback loop. There are many variables that can contribute to oscillation, and can be more apparent in certain vehicle/track combinations, as well as vehicle setup. Many games have built-in compensation for this, but in the case of Gran Turismo 7, there are some unusual cars that are more prone to oscillation (although this could improve with future updates to the game).
Note that the methods to reduce oscillation via the Fanatec Tuning Menu can also potentially reduce desired characteristics such as responsiveness and fine detail, so you should try to find a balance. It might be necessary to apply a unique Tuning Menu adjustment for a car that is particularly prone to oscillation, rather than trying to find a single set of values for all vehicles in the game.
The Tuning Menu settings that have the most impact on oscillation are Natural Damper (NDP), Natural Friction (NFR), and Natural Inertia (NIN). Higher values of NDP is the primary way to reduce oscillation. Higher values of NFR can also help, but it is not recommended to run NFR too high, because it reduces responsiveness and fine details. Higher values of NIN can also help to prevent oscillation from starting, but it is also not recommended to run this value too high, because higher inertia can increase oscillation once it has already started to rock from side to side.
1) Press the Tuning Menu button of your steering wheel and cycle through the tuning menu settings using your FunkySwitch or directional joystick of the wheel until you find Natural Damper (NDP).
2) Press the FunkySwitch / Directional joystick Up to increase the value.
3) Test in order to find the value that suits you best.
In case the issue is occurring on other games as well, please reach out to the Fanatec Technical support. They will be able to further investigate and help you to resolve the issue.