What kind of thermostat are you using? Proportional or On / Off?

If you are using On / Off that may be the problem.

The only thing that causes condensation to build on the walls of the egg box is when the temperature in the egg box is higher then the temperature outside. If your flexwatt keeps going from very hot to very cold, not only will your temps be unstable, but it will also cause the cooler temps outside the egg box.

1.) use a proportional thermostat.
2.) put as many bottles of water in the incubator as possible. They work wonders in creating a much more stable temperature.
3.) make sure you have one or two computer fans circulating the air inside the incubator.

Mike