(This answer is based on what I hypothesized on my old tablet).
This happens because the driver for that tablet stores coordinates for the cursor in his own process and then rewrites window's coordinates with a frequency equal to the tablet's polling rate, osu! sensitivity setting doesn't alter the driver stored coordinates, so if you set up a sensitivity multiplier, the cursor will oscillate between the coordinates the tablet driver has stored and some other coordinates that are affected by the multiplier.
You should set the input to x1 in osu! to avoid all problems, you can change the sensibility in the driver settings (if you use pen mode, you might find some problems depending on your model, if you can't reduce your tablet area, or if you can't disable the sleep mode when you try to play without touching the surface, I recommend you try to quickly change your Genius Tablet for a Wacom Bamboo to avoid those problems).
