The jump in temp with lights on is normal for the stock gauges. There ground reference isn't so good so you get an error in the reading. There are two temperature sensors, one for the gauge and one for the PCM. The one for the guage is just behind the distributor on the intake manifold and the one for the PCM is on the tube to the heater that comes off the intake manifold.
I tried an after market sensor for the guage and it indicated way high so I got one from FORD and it works right.
Don