After experimenting with the LM35 if found out that is it rather critical to use long wires between the arduino and the sensor (more than about 3 meters)
replacing the LM35 with the LM335 solved this problem.
slightly changes the code but way more stable than a LM35 when using long wires.
Calibrate for 2.982V at 25°C at the analog input and you're finished (or any other temperature adjusting the voltage with 10mV/K)
see this temperature log based on LM335 temp sensors, refreshes every 30 secondshttp://www.caluwaerts.info/pool/