first off the gauge does lie to you they all do use a scanner device to read the actual temp, remember the tstat is 195* (factory) im not sure what your stock fan turn on speeds are though i lowered mine. bleed the air out of the system with the bleeder cap on top of the tstat housing the car can be level all the caps should be on. air in the system does cause it to run hotter then so that could just be your problem (i dont know if you know exactly how to bleed a car but the tstat has to be open and flowing before you can start bleeding)