Im pretty sure if there was air in the system the gauge would show it wasnt hot enough. After all its meant to read water temp not air temp.. I would go see if you can borrow a separate temp guage and hook it up enough so you can take it for a test drive and see if it does the same problem. Also if you are gonna flush your rad use this stuff
http://www.outdoorpros.com/Prod/Pres...FUqf4AodQVkADg

A bunch of people I know have been using it with great luck. Just empty the old stuff out pour this in refill with water and go for a little drive and then empty it again and refill with good coolant.

 

It's not that the coolant temp sensor is in air, it's that the water isn't circulating properly to cool down that's the problem.

 

Just to update how this problem worked out, there was air in the cooling system. Not from a head gasket problem though. About 6 months ago, I lost almost all the coolant because a heater hose worked itself down to wear it was sometimes touching a header. So I put in about 3 gallons of water/coolant but evidently that was not enough because over time the amount in the system gradually got too low to the point of setting off the gauge. I also topped off the radiator a couple times in that six months so It never donned on me that I was substantially short on coolant, in this case I was driving on a gallon short of coolant. It could have been many things but in this case Occam's razor comes to mind.

 

WOW

That blows my mind???