So I got my handy Fluke infrared temperature gun. I ran the car on the freeway again and replicated the problem. When it was hot, about 110. I pulled the car over and took some temperature readings. Auxilary fan was not running. Here are the readings in Celcius.

Upper coolant hose: 72.222
Lower coolant hose: 58.8
Radiator reservoir cap: 62
Cylinder 1 head: 82.2
Cylinder 3 head: 94.4
On radiator: 84.4

So, any ideas? Is my temp gauge off? It is important to mention I saw some relief pressure coming from the overflow cap, indicating it is actually that hot.

Will investigate some more, and get the oil analysis before I start dumping money in it. I know this can be characteristic of the 603, but is a bit extreme.