I just went throught this recently with my 240D. I replaced the thermostat with a new one before I put a new(used) engine in my car. Had all kinds of heating problems untill I decided to test the thermostat when I was doing a de-oiling prior to a radiator flush. The thermostat was opening late and I also suspect not opening far enough. I put in a used thermostat I had that had tested out O.K. and heating problems went mostly away. Also, you have to make sure all of the air is out of the system. Air seems to make it run hotter and also makes the temp. gage needle jump around.

__________________
Sedecrem

82 300SD 290k(needs engine swap)
79 240D 354k with new heart transplant w/220k
82 240D w/auto tranny soon to be manual 4 speed