Having years of experience with Fanuc motors, I'd be shocked by a couple of things: 1) that you had a bad encoder, and 2) that the motor would keep working with a bad encoder. Those things are rock-solid and I can count on one hand the number of actual failures I've seen in 25 years. "Bad" for a Fanuc pulsecoder typically means it's not working at all, either due to same hardware failure, like the glass disc breaking, or the electronics failing. Since that encoder is used for motor commutation, a non-functional encoder means a motor that won't spin, and often results in some sort of overcurrent alarm.
Not sure if that robot has any belts inside, but I once saw a Kuka that had been serviced by "professionals" where they'd screwed up the pulley on an idler shaft and the belt was half off. The robot positioning was doing something very similar to what you're seeing.