Check for a loose wire and/or connector.... I've seen where the little rivet that holds the metal tab to the sender gets a little loose with age, this can cause a goofy reading. If you find it loose you might have luck with peening it tightly again with a couple careful taps of the hammer with a properly sized punch.
Is the "sender" the sensor that is by the thermostat? If so, that is what I checked and everything appears to be OK. I guess my next step is checking behind the gauge. I am sort of kicking myself in the butt, because I was just at the instrument panel when I installed my HID driving lights. I should have checked it then, but I forgot about the gauge acting up.
Are there any other sensors between the gauge and the sensor on the thermostat?
Thanks