[ngoma]

Here's a partial answer about your thermostat/coolant flow questions:

In the 7xx series at least, the heater valve is always open, except when running max A/C.

Might want to check that your tstat is the correct one. I would have thought that when fully opened, the block-off disc would completely close up the recirculation port-- isn't that what it's there for?

Greenbook shows the disc should move 8mm min. (fully open) at 216degF (for stock 87degC tstat).