I would start by changing the pressure gauge. It is defective, and not reliable. I think that you're going to have to get the pressure below 4 psi for the flow switch to trigger. 8.5 - 3 = 5.5 psi, so we're pretty close. You might need to get the pressure as low as 2.5 psi, depending on the suction plumbing. If you have some sort of blockage on the suction side, that would reduce the flow rate. You could add a vacuum gauge to the suction side to evaluate the suction side plumbing for resistance.
The sand might be an issue. The sand might need to be changed. If you have a multiport, you can put it on recirculate to bypass the filer to see what happens. Based on the scaling in the cell, scaling in the sand filter is quite possible. What are all of your chemical readings?
If you change the sand, you should inspect the laterals for scaling or other obstructions.
There could be an issue with the flow switch, but I think that the pressure should be verified first. You could pull the flow switch for closer inspection.
You could install a flowmeter, but they're not very reliable at lower flow rates.
What kind of flow are you getting on low speed? Is there good pressure at the returns? Is there good action in the skimmers?
What plumbing do you have from the skimmer to the pump, and from the pump to the pool? Length, pipe diameter and restrictions, such as directional eyeballs.
http://www.bluwhite.com/Products/Variab ... ctpage.asp
http://www.hayward-pool.com/pdf/literat ... mp10_4.pdf