This fix seems to work on my system, which is Slackware 2.0, kernel 1.1.44, and libXaw3d installed as described in its documentation. In particular, the scrollbar just blinks on and off and doesn't change size properly as lines are added the buffer, but using the scrollbar seems to work. After installing the very nice 3D Athena Widget replacement by Joachim Schnitter, the problem remained, though the scrollbar didn't quite work properly in addition to not displaying properly. The libXaw3d library adds a nice 3D look to existing programs which use the libXaw library. All you have to do is install it as described.
Nothing needs to be built or recompiled.
I removed a couple of offending lines, and it compiled with a couple warnings, but still the same problems with the scrollbar. I hope you find this fix useful, and hopefully someone more knowledgable than me will redo it someday.