You haven't mentioned the fan? Is it shrouded? Generally when breaking in an engine there is a heat Spike but it drops back down generally pretty quickly. I've kept a water hose handy and just ran it over the top of the radiator cool it down during the heat Spike and generally the temperature comes back down. Also verifying your temperature gauge is working properly with an external heat gun. It could be a bad radiator cap all kinds of stuff...
the picture is worth a thousand words if you give a shot of your setup and your fan and things like that it may help..