Mano, I actually had some somewhat similar problems with my mom while growing up. Like you, I didn't realize that it wasn't normal; I thought all mothers were hot and cold, up and down, occasionally abusive, extremely sensitive, etc. It wasn't until I left home for college and gained wider exposure that I really realized what I had been through growing up.
In my mom's case, her behavior was due to multiple psychiatric problems, one of which everyone suspected and just accepted her whole life (depression), while the others (OCD and bi-polar disorder) weren't diagnosed until about five years ago.
So I don't know how much help I can be, but from my experience, my relationship with my mother changed dramatically once I left the house and had my own life. I think that first of all, she no longer perceived me as the convenient 'punching bag'---always there to take things out on when she was frustrated. I think on some level she also felt very rewarded by seeing me develop into my own person, getting an education, experiencing the world, etc., and this changed how she related to me. My hope is that when you marry and begin establishing your own family your mother will also demonstrate some of this.
For a period while I was in college my mother also finally got help--therapy and went on Prozac--and became a completely different person for about five years. Energetic, happy about life, eager to try new things and meet people, etc. Unfortunately she has seriously deteriorated over the last 5-7 years.
So on the one hand, her getting better for awhile helped us do some things together, like traveling, that brought us closer. Now that she's 'sick' again, I just try to accept that we'll never have the ideal mother-daughter relationship, and to enjoy what good times we do have together. I am very independent and good at making my own decisions, so I guess that helps me cope with not having a strong mother figure to go to.
As for kids and passing on these bad relationships, although I don't yet have kids, my philosophy is that as long as you remain aware and self-reflective, able to self-criticize, you will do a good job. Also recognize that you can look to other role models in your parenting. I was very lucky that my best friend from childhood had a really strong, loving, calm, healthy family. Spending time with them gave me so many ideas for how I want to do better by my own children. One of my sisters has kids and lives close to our parents. She is a wonderful mom and I don't see her replicating any of my mom's destructive behaviors. And she is vigilant when my mom visits the grandkids, that if she says anything around them that could be hurtful (although my mom is a loving grandmother, sometimes some of the old patterns come out in the way she talks to and about my sisters two daughters), she calmly but firmly redirects the conversation.
Please feel free to send me a PM any time if you think that knowing more about my experience might help you.