small chevy erratic water temp gauge reading

Just got new sbc 388 running in my 56 chevy truck. New bowtie block new eagle 4340 crank 6.0 h beams and probe pistons pump gas 10-1 compression with dart 215 heads. Heads were off my last 388 and were throughly rebuilt(aluminum). Engine will idle all day at 175 degrees with the electric fan on. Sometimes going down the road it will rapidly creep up or spike to 200, 220 and once even 240 but as soon as it spikes it will drop to 160-180. New t- stat my water pump is an edelbrock unit was new last spring no leaks coolant is 50/50 mix and fresh. radiator is a newer summit aluminum I have had no overheating in the past. there isn't coolant in the oil or vise-versa. The trans cooler doesn't flow through radiator its separate. I even tried testing all over with a infared temp gauge and everything is fine. The gauge is 2" autometer sport comp mechanical 10 yrs old I have a new one coming but was hoping on any ideas anyone may have-running out of ideas!!!!!  

maybe your stat closes, couse it's running so cool, then pops back open.
what kind of belts do you have, is it possible the water pump belt is slipping?
serpentines slip when you mash the throttle. ( reverse flow gm ones like 3rd gen camaro)
finaly what about your guage sending wire, any short to ground when the wind is blowing under your hood.
thats all i can think of at the moment...
maybe it's working bubbles out of the system, i usualy drill 2 small wholes in the side of my thermostat so any trapped air can escape during fill up.  

I just put in a new gauge while the old one was still installed to compare the two same identical autometer 3331 mechanical gauge. They are installed in the intake manifold less than 5" apart. The old one will act up sometimes and read like stated above while the new unit is reading just above or below 180 degrees. I think the gauge is trash belts are vbelt no p/s or a/c just alternator and water pump definately no slippage belt is new. I didn't have much time to run it around just a short trip for fuel and home. I plan on a good road test to reverify the gauge and I will repost my results thanks for your opinion.  

the trick of drilling a 1/8 hole in the t-stat will calm down the gauge. it will allow a small amount of coolant to bleed thru and this helps to keep the system temp more even. if you do not have a heater core hooked up so the coolant by-passes sbc tends have big temp fluctions.  240 deg makes you watch the gauge close  

This is an article that describes to a "T" your symptoms: http://www.troubleshooters.com/tlitthypothesis.htm
A quote from the article, "My hypothesis is that many cases of cyclical overheating (temp gauge going up and down repeatedly while driving at fairly steady speed and incline) are caused by combustion gasses escaping the cylinders into the coolant through a flaw in the head gasket."
Besides the NAPA tester ($45) mentioned in the article, I've heard there are litmus paper strips and "sniffers" that the pro mechanics have to test for hydrocarbons in the coolant.