The following was taken from the tech manual TM1716 using an ohm meter test the readings from the sensor. If you do not have a way to measure the actual temp of the engine you should see the ohms changing.
To test the temp gauge if you have some resistors put them in place of the sensor can do this with just the ignition on. Hopefully the problem is not in the cluster.
You can also make sure the wire from the sensor to the cluster is good. It is bare in a spot and touching metal you will get the results you are getting.
60°C (140°F) 134 ± 13.5 ohms
90°C (194°F) 51.2 ± 4.3 ohms
100°C (212°F) 38.5 ± 3.0 ohms