Indeed my master cylinder was faulty, wish I took a video of it compressing next to a new one. I am still convinced that is what fixed it. I remain nervous as I know the problem could reappear any time.
When I was driving, it almost was as if the automatic handbrake engaged immediately after I let off the gas pedal at speeds above 60. Let me know how it goes with the master cylinder and/or the fuse, the fuse is a great idea, I didn't think of that! Try that first!
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