12vdc is a very aggressive on switch contacts. Every time the pump switches off and on a flash will occur as the contacts make and break.
I doubt it has anything to do with faulty connectors etc.
This was the reason why we went for a controller 8 years ago as the Shurflo (and others) don't tollerate the on and off application very well. Although you have adjusted the pressure higher to reduce cycling you have created another problem. The higher the pressure before the pressure switch cuts out, the higher the amps the motor is drawing which creates a greater flash across the points.
You could get a cheap 40 amp 12 v relay and use the pumps pressure switch to activate it. The relay will draw very little current from the pressure switch which should make it last for years. Relays are cheap and will be much easier to replace as and when it should fail.
http://www.ebay.co.uk/itm/5-PIN-12V-40A-Automotive-Changeover-RELAY-including-WIRING-LOOM-/400292899718?pt=UK_Cars_Parts_Vehicles_Terminals_Cabling_ET&hash=item5d3350eb86#ht_4825wt_1161This should work although you will still have to replace the microswitch on your pump. These microswitches are available for a couple of £'s from Maplin.
In the power tool trade, 12v machines could be wired so the positive wire went straight into the motor (red) and the switch was on the negative wire (black). The disadvantage is that the motor is 'live' but the windings in the armature do reduce the flash across the points of the switch.
I would still wire in a relay though.