THE CAR IS SUPPOSED TO IDLE LIKE THAT UNTIL IT WARMS UP MY 89 LUDE DID IT AND NOW MY 99 DOES IT bUT ONCE THE THERMASTAT OPENS UP IT IDLES NORMALLY I BELIEVE IF YOU HAD A PROBLEM IT WOULD ALWAYS IDLE LIKE THAT NOT JUST WHEN IT COLD I LIVED IN MINNESOTA WHEN I HAD MY 89 AND IT ALWAYS IDLED LIKE THAT UNTIL IT WARMED UP IT ESPECIALLY DID THIS IN THE WINTER TIME

 

It shouldn't bounce up and down though. It should stay at a constant RPM while warming up. If you replaced your IAC and it's still doing it, it might be a vacuum leak that you can't see. or the coolant line that runs throught the throttle body might be blocked or have a problem with it. I know when I bypassed the throttle body coolant line completely on my lude, it idled like that until it got warm enough.

 

if it bounces up and down you have a vacuum leak which is most likely because you did not cap off one of the ports off of the intake manifold.