[woodsman]

If the gauge USED to work, then it could be a faulty sending unit but if it has always acted this way than it's probably hanging up on the fuel lines inside the tank. I just replaced my fuel pump and ( with pelican's DIY tech article) noticed this potential problem and had to use 2 additional zip ties to tie the lines to the fuel pump/sending unit post on the opposite side than the float. It's easy to see that if someone was in a hurry, they would just lower the assembly in and assume all is well.
To repair this problem after the fact one would have to pull the assembly out of the tank. Study what's happening and use zip ties to force the lines to bend along the inside of the post. Pelican parts has a very helpful DIY article. It's best to do the job when there's very little fuel left in the tank. Also, beginning in MY 2002 a different set-up was used and I'm not sure if the above applies or not.