I had a similar problem when I first learned to losen my grip. I changed 2 things to fix it:
1) I noticed that my stroke wasn't 100% straight, when I had a tighter grip, I was able to "steer" the cue ball to where I wanted. When I losened up, I quit steering, so I missed a lot of shots I used to make. I video'd myself to see what I was doing, and then changed my stance a little to better align myself. That really helped.
2) I ran a lot of stroke-straightness drills for hours on end figuring out how I stroke and where I stroke the cue-ball. It could be that the lose grip is also allowing you hit the CB with un-intended english, thereby throwing the OB off-line.
That's what worked for me, but I'd be curious to see what the instructors say about this.