BilboBoggles, I have recently bolted the same unit into a 'spare' threaded hole just below and behind the thermostat housing.
My normal operating temp ('99 300TDi) is between 77 and 85 degrees, with the gauge being nicely sensitive to minor changes in driving conditions.
Prior to getting my car dyno-tuned this morning (due to the fitting of an upgraded intercooler) it used to struggle to maintain 80km/hr going up Willunga Hill ( a long steep gradient south of Adelaide), and the TM-2 temp gauge on a typical 25 degree day would read 98-100 degrees by the time I reached the top.
Now with the car dynoed, she's pulling up the same hill today (30 degrees air temp) and holding 100 km/hr but at a cost... the TM-2 went up to 109 degrees (audible alarm going crazy!) by the time of reaching the top, but cooled quickly back to mid 80's shortly after.
However, having said all that, I'm inclined to agree with justinc about not being too concerned, given that the needle on the dash gauge had barely moved at all.
Of course it would be a different matter with prolonged stress on the motor, but short bursts into the 'red zone - wherever that is - should be ok surely!? Is that right guys?

