OK...took the dash out (again). I unwrapped the harness going to the steering wheel. No wires (other that the black ground) are effected. The black wire has lost some coating and is showing bare due to having heated up so much. I will splice new wire to replace the black. No other wires are bare, kinked, etc. There is one wire (white wire) that goes to the OBDII plug near the cigarette lighter. That has a slight bare spot...but no sign of scorching or even metal that it could touch. I opened the hood, ran through all the wires I could find. Nada.
To repeat....when I had the key OUT and you stepped on the brake pedal, the lights would go on and the dash lights would light. If you giggled the steering column (with the tilt in open position), you could get a spot where the car was 'fine' (all was o.k.), but the second you let go of the wheel, all blank and it would revert to the oddball behavior. There were no wires (other than the black -- which is screwed onto the column at it's end), that show any sign of problem). HELP!!!!

The acronym you need is FUBAR, an old Air Force term - beyond all repair.

The ground wire to the steering column should not be hot. Somewhere else you must have crimped a wire against metal when reassembling the dash. You will need to cut and crimp a new section of wire to properly ground the black wire back to the column.

Leave the battery unplugged until you find the problem.

Klaus
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Why are Volvos so endearing? Its just a car.