Mike,
One more thought after your further description: it sounds like you have been reading a voltmeter instead of a temp gauge
Is the temp gauge electrical? If so, could it be responding to alternator voltage? When you spin the engine faster, the voltage may rise, and the gauge may indicate higher temp which may or may not be the case.
Maybe Hersh's suggestion of using an infrared non-contact temp gauge on it would be a good diagnostic?
Just another bit of confusion for the pile...
If it's mechanical, please ignore the preceding!
Tom