The dowel in the side of the block would need to be driven inward about 1/2" below the surface to put the oil system into the "full flow" mode. If you do that, you'll either need to install the correct canister filter and run 1/2" diameter lines, or run a 1/2" diameter bypass hose from one port to the other. With the current setup, you'll need to use a regular bypass filter and 1/4" diameter oil lines. That thermostat is a "bellows" type original equipment item. There was also a specially designed thermostat that allowed coolant to circulate through the engine but not the radiator during warmup on the big rigs, but it's no longer in production. The simplest way to assure proper thermostat operation is to use a 235-type housing without the big bypass hose system. Otherwise, some of the hot coolant can return to the engine without going to the radiator first.