That sounds odd. It is obviously possible that someone mangled the needle, but the result should be that you can make it either rich or lean, with no transition in between. If the needle was simply cut off very short to make the mixture non-adjustable, it should be extremely rich. Since it was hunting, it is most likely lean, and it sounds as if something else sinister has been done, such as soldering up the bore of the main jet then drilling a smaller hole than it had originally, so it acts as a fixed jet instead of an adjustable one. I think you are going to need to remove and strip that carburetor, cleaning and inspecting the parts as you go.
