Yes, the rack and pinion assembly can cause the symptoms you described. It happened to my mother's '95 Grand Caravan, but it is not very common. The rack will cause the same symptoms when the front wheels are jacked up off the ground. If the binding and jumping goes away, still suspect the upper strut mounts.
$1000.00 seems WAY too much for a rack and pinion assembly, but most of my experience comes from working at a very nice family-owned Chrysler dealership through 1999. Up until then, the only way to get a new rack and pinion was if the old one was still under warranty. The listed retail price was only $450.00, and labor only took about an hour to replace it not including the required alignment. Some other brands take a lot longer to replace the assembly, so $250.00 for labor seems about right, especially if it includes the alignment.
Remanufactured rack and pinion assemblies have some modifications that increase their reliability. They cost a lot less than than new ones. Caravan units cost around $150.00. You might want to inquire at one or two other shops for a second opinion and estimate.
Tuesday, April 6th, 2010 AT 6:12 PM