I had issues with a GSC-10 when I first got my garmin, and had similar issues to what you were describing (no power meter at the time). Even though it has GPS, it uses the wheel magnet to register whether you are moving or not, so if you lose your magnet (or have a bad GSC-10 in my case) you will get the squirrely results you got.

An easy mid-ride fix would be to tell your garmin you don't have a speed and cadence sensor, and it will get speed and distance from your GPS position fixes.