Urgent help needed please - Audi pro's where are you?

[Livolsi, Stephane]

Fellow listers I desperately need your help.  Here's the problem:

My car is a 1986 5KTQ.  The A/C stuff has been removed (pump and condenser -
the thing in front of the rad)
The problem is that the car is overheating, even in -30C temps and with the
fan manually jumpered to full bore jet roar level 3.  WTF? HTH? (how the
hell)
I am not a mechanical dummy and last night me and fellow lister Tihol took
out the thermostat and tested it.  It worked fine but we left it out anyway.
Start her up again after putting it all back together and temp climbs and
climbs to 100C and manually turn on the fan and temp does NOT come down.  I
just don't understand!!!  I purged the air a few times - here is how it
went.  I would top up the expansion tank, run the temp up to 100C, shut it
down and let the steam/air vent out of the little hose going from the top of
the rad to the expansion tank.  I purged this into an empty antifreeze
container so that I could re-use it.  The antifreeze that came out did have
a brownish tint to it, but I could not detect any separation of oil, even
after sitting overnight so I assume no major internal damage---yet.  Also
pulled the dipstick this am and wiped it on a clean white tissue and only
saw oil - no hint of antifreeze.

The engine runs, fairly well but it sounds like the water pump bearing is
noisy.  However the water pump runs off of the timing belt so if the engine
is running, that pump MUST be pumping....right?  When the engine was cold
and I started to warm it up, I could feel the radiator gradually getting
warmed up so I am assuming the coolant is circulating.

One other thing, there is no warm air at all in the cabin, even when the
engine temp indicated is 100C.  the valve is fine, but I am assuming the
heater core is plugged but I am sure this shouldn't affect engine
cooling/heating ops.  That is another issue that I will tackle after I
figure out why my car is trying to cook itself.

1.  Those of you with 5ktq's - what is the normal operating temp as
indicated on your gauge?  (those with bad multifunction temp senders need
not reply  :))
2.  Is it possible that the water pump is not pumping when the engine is
running?
3.  Does anybody have any ideas as to what might be the problem?

Thanks for any and all advice and suggestions

Stephane