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i have an older oberheim edp with loopIIIv5 and had this problem.
sadly, i changed several things and am not sure which fixed it.
1.  replaced regulator chip with lower heat version.
2.  cut pin 5 of U12 as described here:
        http://www.loopersdelight.com/tools/echoplex/FAQ6.html#thermal
3.  changed R30 and R10 as described here: 
        http://www.loopersdelight.com/tools/echoplex/FAQ6.html#Anchor-47383
    (this should have no effect on the loop fading)
4.  replaced the crystals with some supplied by andy ewen.
    (i think this is probably what fixed it.)
i believe it was working well after this, but since then i have
also installed loopIV...
note that if you have a newer gibson model, it should have all
of these already.  (though, i'm not sure about the crystals)
hope that helps...
> ...
> I recorded a loop using the overdub method (with Feedback set 
> to 100% using a midi pedal), turning overdub off after 
> creating the loop and the loop after a short while began to 
> gradually fade to almost nothing.  When creating the loop by 
> ending it with record instead of overdub, the loop played 
> indefinitely with no reduction in sound level.  With this 
> test, I found it pretty convincing that using overdub, it is 
> not possible to keep feedback set to 100% and prevent the 
> loop from fading.  If I am missing something here, please 
> help me understand the right way.
> 
> Thanks,
> Steve
>