1969 barracuda 383 formula s temperature/timing help

stock guages and senders can be misleading.

Exactly.....^^^^^^^^^^^^^^^^^^

Since this seems to be a on going problem, you really should try and get a aftermarket gauge, even if it's a cheap one, to try and get a accurate reading. You could always hook it up temporarily if you want to keep the stock look.

As far as the timing, these days, the reality is you'll really need to disregard the FSM. Even with a stock hi-comp 383, you're engine should still be much happier with 12*+ BTDC initial timing. It may actually like much more considering the fuel grade you would like to use. The main thing is to get your initial in a good range, and then limit the total mechanical advance, if need be, to around 36*.
There is always the possibility of a lean carb contributing to your heating issue, but you need to get the timing right first, and also know what the real water temp is.