[Vwdiesel] temperature gauge/sender on 82 NA diesel

[ken1]

Heat bothers me, especially when it comes to my 82 1.6L NA caddy.
The temperature gauge has been setting at the low end of the gauge at about the third mark. Since my temperature sensors on the head are both 120 C, I decided to start a diagnosis process. 
First I documented how long it takes to reach operating temperature. In north Texas, this time of year, it takes about 4.5 miles of driving. Then I switched the temp gauge wire and the glow plug wire on the sensors. Went for a drive after the engine had cooled down. Same 4.5 miles and the needle stopped moving, but this time the needle settled at the center of the gauge, i.e., 6 1/2 marks on the gauge. The gauge stays there while driving at  68-70 mph. When the engine is idling and the fan cycles on, the needle drops to about 5 1/2 marks.

When I measured temperature a hose near senders I got 78 C
Top metal heater hose 67 C
 
So I know I need to replace one 120 C sender.

What is the optimum operating temperature of a 1.6L NA diesel engine?

Is there any relationship as far as temperature range for the gauge?

Is there a maximum temperature that can be registered on the stock gauge?

What would happen if I connected the sender to a 150 C temperature gauge?