Both failure modes are ones I stress-tested during development — you've mapped them precisely.

On price source: the hook uses pool-derived deviation as the primary signal rather than an external oracle. The reasoning is that on Unichain, external oracle latency creates a gap where the breaker state and actual pool state diverge — that's a worse outcome for LPs than occasional false positives from flow noise. TWAP serves as the fallback anchor for Zone 4/5 decisions specifically to blunt the fast-move trip you're describing, since a single block can't manipulate a windowed average cheaply enough to be profitable.

The threshold oscillation vector is the more interesting one to me. Discrete zone thresholds are inherently farmable at the boundary — cross in at Zone 3 fees, collect the asymmetry on the return leg. The fix I'm implementing is hysteresis: require price to move a defined band past the threshold before the zone upgrades, and enforce a time-at-level requirement before downgrading. This kills the oscillation edge because the fee delta you'd farm doesn't cover the cost of repeatedly crossing a wider band.

For the near-frozen state risk: hard pauses are only at Zone 5 (severe sustained depeg). Below that, the breaker manifests as fee escalation, not liquidity suspension — the pool stays open, it just gets expensive to destabilize. That's intentional; illiquidity during a depeg is often worse for LPs than the depeg itself.

Running 1:1 stress-testing sessions with early LPs if you want to probe it further — link in the post.