2004 Santeria Thermostat question

I just finished restoring a 2004 Santera and replaced the motor with a remanufactured 5.7. Water tested it last weekend for the first time and ran great for about 10 minutes, but noticed that temp gauge would swing wildly from 210 back to 155, and then again. After about 3-4 minutes of light use, engine began to bog down under load. Thinking that bogging might be related to ECM reading temp issue and want too sort out thi issue before I iMovie to trouble shooting fuel issues.

My question is: Is it possible that I have the thermostat in the wrong part of the housing? Currently it is seated in the lower part, but I read elsewhere that it belongs in the upper part of the housing. That post said having it lower part would generate the exact symptoms I described. Can’t find any diagrams or videos showing where it belongs. Any help is greatly appreciated.

Go to you tube
Look up “ski boat overheating and cooling 101”
Ron Tanis
This guy is great!