I experienced this aswell on my DFP. Twas due to FF being too high. I'm currently quite surprised by how much nicer it is with it turned down, it still feels meaty, and I don't have to put up with the ridiculous shaking backwards and forwards whenever the wheel is centred.
I'm just using the settings other people have recommended, 100% effects strength, then the rest on 0%, with centering spring enabled.
The understeer related lightness does seem to be a bit lacking, well, it just feels a bit more through my real car's wheel than through the DFP in the XFG.
Although, thinking about it, I'm understeering for different reasons IRL versus LFS, so I'll reserve judgement on LFS for the minute.
New physics are pretty awesome though, I have to say. Oversteering the rear wheel drive cars feels so much more 'real' for some reason.