Hi All: The guy who rebuilt my cylinder head installed the brass temperature sending unit into the head with what looks like white pipe dope sealer. Is this correct
No. It might or might not completely block the electrical connection needed between the sender and the head, but it's not at all needed or beneficial. It's brass; it's not going to seize; number one. Number two, those are dryseal threads, designed to create a leak-free seal when assembled dry/without any other materials. Remove the sender, clean it all the way up, and reinstall it dry.