I have three Ibanez RG guitars (550, 370, 1570) and they all have a licenced Floyd Rose trem system on them with a locking nut.  There's no way the Variax 700 trem is any match for them.  That said my Variax trem was like yours when I first got the guitar.  I spent a little bit of time balancing the trem in the back of the guitar by adjusting the springs/claw tension.  I got some fine wet and dry abrasive paper, folded it and just ran it up and down the nut slots to ensure they were smooth.  I applied a little bit of Vaseline/pencil lead to the slots for lubrication and I exercised the trem by pushing it fully down and pulling it fully up ust to stretch the springs a bit and to ensure they were 'settled' it their most natural positions.  I added a very thin piece of foam behind the springs to deaden any spring noise.

I re-strung the guitar with 9's pretty much as soon as I got it and I wound the strings under tension trapping the end of each between the first and second winding as it pokes through the hole in the machine head which locks the string anyway.  This immediately made a difference.

I got the Grover locking machine heads after I'd had the guitar about 6 weeks which improved it a bit more - but I have to say that the the work I had already done made the biggest difference.

The Variax trem works OK for me but I don't use it quite like I do my Ibanez's even though it does return to rest at the correct pitch when it's warmed up.  I do prefer the locking nut that you get with a Floyd Rose and it does inspire confidence in the tuning.  It's not that I think the Variax trem will let me down, but  when you are used to a Floyd Rose it is a matter of being totally confident with anything else :-)

If the guitar is mainly ending up slightly sharp when using the trem, you might need to slacken the claw screws in the rear spring cavity just a tiny bit to better balance the floating action of the trem and also smoothing your nut slots a touch will probably help.  I can't take credit for this tip, but it has been suggested that the Variax 700's nut is a fair bit wider than it needs to be, and that if you angle the nut slots down towards the headstock or re-shape the nut so that the headstock side is angled back the result is te same in that the string has a narrower area on which to pivot and therefore less area on which to bind.

My main requests in any new Variax would be for an Ibanez Wizard style neck with locking nut, Floyd Rose trem and magnetic pickups.  I think GraphTech make piezo saddles that will fit a Floyd Rose, so it's not beyond the bounds of possibility to customise a Variax with a Floyd Rose.  In fact earlier this year someone had transplanted a Variax's guts into an Ibanez RG but had left the pickups (or their covers) in place for cosmetic reasons.  The guy had put it up for auction on eBay.  I have to admit I was tempted :-)

Nick