used a mechanical gauge in the top of the rad and if I remember correctly it was over 200 degrees also used a infrared temp gauge
now I'm worried that the head gaskets are installed wrong

as was said previously, some head gaskets purposely block coolant holes, so i would try it on the road first.
however, i'm still wondering about the "rebuild" quality.
you may eventually have to pull the engine and check everything, just to be sure of it's integrity.

I had a issue with rust flakes clogging the top of my radiator. Cleaned the radiator and put a homemade screen in the upper hose at the radiator and caught a bunch of crap, so I installed a Champion cooling system filter in the upper hose and it has worked great.

like said by another, 200 deg is not hot... and to throw my two bits in if anyone hasn't already said it... (and everyone has said great stuff)....

- coolant temps readings are only just that, coolant temp readings... not engine temp. One of the most common misconceptions is a thermostat rated for a smaller temp opening means your engine will run cooler... The coolant system is designed to transfer heat from the engine to the air, if you run a too cool thermostat, you're not letting the coolant absorb enough heat to transfer away from the engine. A hotter rated thermostat will absorb more of the engine heat, and though your coolant temp will be hotter, your engine will actually be cooler. So running a higher temp rated opening thermostat will keep your engine cooler, not hotter, and vice versa (that is, when all things else are running correctly).

- just because you have good visual flow in your radiator (cap off, engine just warmed up enough to open the thermostat), doesn't mean you're flowing coolant well. A rad can get clogged just enough that it'll look like it's fine, but, especially with a mechanical water pump, at lower engine rpm (and lower water pump rpm), coolant will flow fine, but at high engine and water pump rpm the coolant will start to back up, or rather, not keep up with the higher rpm... and will start to overheat and eventually puke. The engine isn't overheating, it's just the coolant overheating (though obviously once the coolant overheats and turns to vapor then the engine ends up overheating too, but only after the fact)

- always run a good mechanical water temp gauge in addition to your stock temp gauge, if you aren't already. You'll get a more accurate reading and you'll notice that even with the sensors side by side in the intake manifold (if that's where you're running them), they won't consistently agree with each other all the time... more data the better..

- what kind of fan are you using too? old school fixed fans are about as useful as no fan at all, clutched fans a lot better, shrouded over unshrouded any day, but you just can't even begin to compare to a good electric fan (but keep in mind that you'll need a higher amp alternator to run an electric fan)

- again, 200 degrees is not hot. Even if you had steam visually escaping from your rad's cap, that still doesn't mean you engine is overheating... Signs of your engine overheating are noticeable sluggishness, loss of power, and pinging. The only way to actually gauge if an engine is running too hot, is if you had EGT sensors at each exhaust port/header primary (or used a IFR gun, but that would only work with the hood open at a stop, unless you can convince a friend to hang onto the fender with the hood removed while you drove it around hard... hey, we all have a friend that would do that... ha)

But yeah, clogged anything is always bad, but you can have a good amount of sludge and old casting sand in the bottom of your block and it really won't affect much...

the fact that he had all the grunge in his water jackets are a pro rebuild worried me. Doesn't take much effort or talent to clean that stuff out when it's a bare block on teh engine stand. What else did they blow off doing?

Yes you should run a 180* thermostat to bring the engine up to a good operating temperature.

update....
first off thanks again for the input has helped a lot
yesterday without a stat I ran the car on the interstate for 20 miles, even got up to 80 mph and the temp. was much lower. within the middle of the gauge. When I got off the
freeway the temp slowly climed up. This was after waiting in traffic on the exit ramp. Got back on the interstate to return home and at highway speed the temp returned to
the middle of the gauge. Next I think I will try a 180 stat and antifreeze. Hoping to do this in the upcoming week.

Bennoel

low road speed cooling issues are usually airflow related. Fan, clutch shroud, debris in the fins, that kind of thing.

At highway speeds airflow thru the radiator is driven by vehicle speed not the fan pulling air anymore.

I didn't see any mention of you having a shroud, do you?

I would hold off on that tho winter is coming & temp does need to be above 180 & what Sniper said, there is an airflow problem (assuming the rad flows well). EDIT on second thought if the rd was partly plugged it would run hot a speed (more eng heat/not enough flow to cool)

Yes I'm running a shroud, also clutch fan, proper 340 rad. Everything is new or rebuilt that's why I'm frustrated and of course disappointed with the engine issues. I'm thinking maybe the rad is partially blocked as the sediment in the engine might have been circulated in the initial start up??

Again thanks to all

Bennoel

Drain the coolant low enough to see the top of the radiator core. If you see crap in the radiator that could be the problem, you can use a small mirror and flashlight to see inside the top tank.

If it has not been mentioned check to see if there is a spring in the lower rad hose. If not it could be collapsing.

When It gets up to operating temperature lay your hand across the front of the radiator and see if there are any cold spots. If you find cold spots your radiator is clogged. Hot coolant won't get to it to warm the radiator.