Erratic temperature guage on 1991 Audi 100

[VNorman@zoomit.sikorsky.com]

Can anyone explain the following problem that I have with my 1991 Audi 100. 
After driving a mile or so from a cold start the temperature guage gets up 
to about quarter scale and then abruptly drops to zero. It stays this way 
until the entire coolant supply (including the radiator) has got hot. Then 
it starts to read correctly again. 
The symptoms would seem to suggest that the thermostat is opening early and 
staying open (doesn't make sense) - but changing it didn't help. With our 
current mild temperatures the problem is no big deal, but come January I 
can see me freezing to death. Any suggestions would be much appreciated.