160 too cool (IMO) A stat will not cause an engien to heat.
A coolant recovery system the overflow tube must reach to the bottom of the overflow tank or the coolant cannot be syphoned back into the radiator on cooldown. The over flow recovery tank must also be vented or the coolant cannot even enter the tank.
There are over flow tanks that are just that - over flow tanks- that are not designed to return the coolant to the system.