So had another chance to play around with it and think I know for sure that it is the heater core and probably back flushing it will probably help it out.

When the heater is 'cold' the hoses run the same temperature, but when the heater is 'hot' there is a noticeable difference in the temperatures of the hoses...something I didn't check before, I had the heater on cold when I changed the thermostat and felt the hose differences.

I also was able to poke my head under the console and the pin the temperature switch operates on does appear to be moving its full range.

So I am going to try to flush the heater core tomorrow and see how that works out.

What is the best way to fill to make sure you have no air in the system?