Car overheated right after I got off the freeway?

[Navarone]

In the original post, second to last line, first 6 words...

Yup, that's exactly what and where I missed.

[Cephas]

The erratic temp gauge could also be a loose brass nut on the back of the cluster.

[E30_Narek]

The electric fan will not help keep it cooler than a functioning fan clutch.

Your temps vary because you have a non original thermostat in the car or a faulty one. The way the stock setup (properly functioning) works is that the thermostat opens just below the halfway mark on the gauge and the fan clutch turns on right about at the middle of the gauge. This gives you a very stable needle because if extra cooling happens (highway speed airflow) the thermo closes and keeps the temp up and if the temp starts to climb , the fan engages more and and keeps the temp down. If you put a colder thermostat in, highway speed airflow will drop the temp to the thermo close point which might be the first line and so your gauge will move up and down as you describe.

A faulty thermostat (not flowing properly) will keep the fan clutch from engaging at all since the fan is turned on by the radiator heat.

To test the fan clutch, get the engine hot and stick a rolled up newspaper into the fan. If you can stop it, it is not engaging.

Even when my cooling system was stock, my temperature gauge was still unstable. Every 20 or so miles I drove, the needle went above halfway, then after a while returned to half then went down to below half, and repeated over and over.

EDIT: I've come to the conclusion that my brass nut is loose. My temperature gauge wiggles and fluctuates from time to time so I'm assuming the nut is loose. Every time I tap/slap my dash around the temp gauge area, it jumps or moves.

[Farbin Kaiber]

x bajillion on the fan clutch, I'd also check the shroud and blade for cracks while they are off, also, I'd put in a new thermostat and coolant mix at the same time.

[E30_Narek]

x bajillion on the fan clutch, I'd also check the shroud and blade for cracks while they are off, also, I'd put in a new thermostat and coolant mix at the same time.

No need for a new thermostat or coolant. I put in a new thermostat a little over a month ago and along with a whole coolant flush + blue BMW coolant.