another source of idle instability on that car with that milage may be the electronic trottle assembly. Get throttle inspected and to have it cleaned. Also the crankcase vent hose and nipple should be checked and cleaned if indicated.
but do this first:
That car does have neutral control and to see if NC is the cause, place car in Drive once engine is fully warmed up and then hold it still with parking brake with no application of foot brake. Then depress foot brake. If the fluctutations in idle speed occur only with foot brake held then it is NC causing the problem. If while holding with parking brake it still does it but is worse if you touch throttle pedal and release it, then it is dirty throttle housing and blade causing the electronic throttling system difficulty in holding the throttle blade with enough stability to have smooth idle.

While MAF or throttle module are possibilities, more likely you have a valve body problem in the trans. The 01 automatic 5 cyl volvos have a system called "neutral control" It is supposed to seamlessly disengage the trans at stops and re-engage when you release the brake, for smoother idle. Symptoms of a faulty valve body include harsh engagement when brake is released, and a noticable clunk about 2 seconds after coming to a stop, and continued clunking or "twitching" as you called it. This feature was deleted on 02 models except for some early 02 non turbos.

Like it or not, the ONLY place that can accurately diagnose and repair that car is a dealer as it needs their Vadis PC and info base.

It's likely to be either a MAF meter and/or throttle unit.