Another with the same issue!!
I found this thread whilst looking for a solution for the same issue.
Baxi Platinum Combi HE 40, installed about 10 years ago and apart from a couple of thing over the years (expansion tank, over pressure valve leak) it's worked perfectly.
Yesterday, plumbers (Corgi Home cover - local plumbing firm) were here to change a leaking rad valve, drained down the system - replaced valve, bled rads & pressurised system, all good.
Today, shower temp fluctuating (it's never done this before), so I read this thread and started testing:- Turn on HW tap near boiler, and get same issue as original poster e.g. DHW temp climbs to 97Deg on display then burner shuts off, temp reduces then at about 40Deg the burner fires up, 97, 40, 97, and so on.....
Clearly the boiler is no longer modulating like it used to.
I tried turning off the mains water to the boiler whilst the HW was running to see if that temporarily fixes the issue (like the original poster) but it didn't. Still not modulating.
So, does anyone have any suggestions for further tests to see where the fault could be before I contact Corgi Homecover? I don't want them to start replacing things at random and run into the same problem as the OP.
Thanks!
Update:- solved by replacing the flat plate heat exchanger.