The flickering you are describing is not a known simulator problem.
There is, however, a bug in the simulator that when you write to the KEYBOARD address, it affects what will be read the next time from KEYBOARD.
Your program may be writing one word beyond the screen. I haven't seen any fill programs that altenate filling white and black caused by this, but I have see programs that are stuck continuously filling white or black.
If you don't find an off-by-one bug bug in your code, feel free to email it to me and I'll let you know what I find.
--Mark