Well I figured it out after three hours of looking for a way to mount it where the reading would be reliable. I first thought it should be mounted in a water jacket in the engine. Then after figuring out how the factory sensors worked I had a revelation LOL. I found another boss in the head that was already tapped. It wasn't the same size as the sending unit but it would work. I used a adaptor to go from 1/8th inch npt to 3/8inch npt.
The factory doesn't actually use water to gauge the temp just the switch touching the surface of the head. So the boss on the head that was unused was of the same design so it should work well I hope.
I will report how well it works when I get it all wired up and on the water. Hopefully this afternoon. Which leads me to my next question. How hot should it get? I am guessing somewhere between 130-160 is fairly acceptable?