Lately, I've been having a problem with the cooling system on my car that
has both me and the dealer at a loss for an explanation.

The car is a 2001 (North American market) Focus ZTS.  It has the 2.0L Zetec
engine and automatic transaxle.  When I drive around town, the temperature
gauge indicates that the car is running warmer than normal.  (I used the
dash's "test mode" to get an exact number:  112 deg C, where normal appears
to be about 106C.)  What's more worrisome to me is that when I take it out
on the open road, and drive at highway speeds, the needle travels nearly all
the way to the red zone, staying at 118 deg C.  Once, it made it to the red
zone (120C) but quickly dropped back down to 118C.  Strangely, the car will
lose a degree or two sitting at a light, but will warm up once back
underway.

For the first seven years I drove it, the temperature needle never went past
the halfway mark, so this behavior is pretty alarming.  I took it to the
dealer, and they did the following:

* Pressure test on the coolant system, and discovered a crack in the coolant
 recovery tank.  Replaced tank, and the thermostat.  That was a problem,
 but apparently not *the* problem, since it had no effect on the
 temperature.
* Re-ran the pressure test.  No leaks found.
* Tested the engine block.  No leaks there, either.  (Thank goodness!)
* Checked the coolant flow through the radiator.  Situation normal.
* Checked the thermostat again.  Normal.
* Checked the fan and associated relays.  They seemed fine.  (Actually, I
 could have told them that.  I can hear the fan roaring at high speed after
 just about every highway trip.)
* Checked the temperature sender and gauge.  They also seemed to be working
 normally.

They spoke with Ford Engineering, which claimed that up to three-quarters of
the gauge is normal (!), so they suggested they I drive it for a while, and
let them know if the temperature went much higher than that.

So, does anyone know what the normal range of temperature is for this
engine?  I suspect 117-118C is too high.  Perhaps more importantly, has
anyone else here seen this problem?