Scud,
Sounds like you have a split in you wastegate actuator hose or something similar that is allowing too much boost. The ECU can only allow aprox 8psi as max boost when it opens the VSV fully so to get any more boost there has to be a bleed in the system or your wastegate is getting stuck. Hence you are hitting the boost cut.
To reset the boost cut pull the engine fuse for 30 secs. First of though you need to check out all the vac lines thoroughly. While you are doing that may as well disconnect the VSV line (the one that disappears off behind the engine from the wastegate actuator) and plug the port. This will give you much more consist boost and stop the ECU playing silly buggers with your fun Get yourself a cheap bleed valve...they are all pretty much the same and do the job just as well as each other. Turbosmart gated bleed valves are approx $100 and work well. Now you can set boost just below the boost cut and enjoy the extra power consistently.