OK guys here is the update, first of all the catalytic converter is NOT the problem, I don't know what shotgun fired that diagnosis!
I was thinking about the fact that the problem only ocuured after warm up, when we actually go into closed loop operation. For $20.00 i put in a new O2 sensor and bang, no more problem.
Now though I would like to center the fuel mixture, does anyone know how to measure and/or set the fuel mixture.
At one shop I worked at we had this cool little box that had an LCD readout and a red/green LED that pluged into the Diag port near the ignition coil. when the LED was green that indicated that the Lambda controller was controlling the mixture, then you set the mixture until the readout was 45-55 on the readout.
Does anyone know how to build this device, ours looked homemade from a radio shack project box.