my car is the same way. on a hot summer day, 90 to 100 degF ambient the water temp guage is nailed to 95, no matter what driving conditions. but whenever it is raining or night time driving it goes up to 100, then goes back to 95, it fluctuates back and forth, up and down, and so on, especially now that the ambient temps here is now ranging from higher 80's and lower 70's, high and low. it always acts this way since i got the car, different beahvior each season, never had any problem, so i think it is normal for this particular car. but i want a new plastic 9 blade fan, because i think my current 9 blade aluminum is now too heavy for my old fan clutch.
anyway, my analysis tells me that the reason it is behaving weird like this is, i think that the fluid in the radiator is too cold when ambient temp is not that hot, therefore when the thermostat opens the cold water from the radiator immediately shuts the thermostat down until it becomes hot again to trigger it to open and allow the cold fluid to cool the engine again and shut the thermostat, and so on, hence the gauge fluctuation. hot. cold. hot. cold. hot. cold....

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'85 300D Turbo - CA Version

This conclusion is not based upon fact. If this was the true situation, then everyone with a 617 would experience the same behavior. The fact that they don't rules it out.

So if it is ruled out, are there any theoretical explanations based on the fact that it is acting this kind of this particular behavior? We all know for certain that, even though they are all the same makes, year, model, and even serial numbers and production date, each individual car/engine has its own personality, right? Hence the reason a said that my car, specifically, is acting wierd ever since I acquired it. So what made you conclude that everyone with a 617 would experience the same behavior?

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'85 300D Turbo - CA Version

You're making an argument that the temperature fluctuation is due to instability of the system as the engine reaches operating temperature. If this was inherent in the design of the 617, all engines would exhibit the same behavior. Variation in the tolerances of the build won't provide a suitiable margin for acceptance of this behavior as normal.

I previously recommended that you check the temperature of the fluid with an IR gun. You have failed to make this attempt and further discussions are moot until you accomplish that task and obtain some data.