As long as the ground strap is attached to bare metal, not on top of paint (or rust) at both ends you're probably OK, but something caused that capillary tube to become the ground path. I'd recommend using a long ground cable of about 0 gauge or so from the battery to the bellhousing, rather than rely on a battery/frame/engine ground path- - - -too many places to get a high resistance connection. Pull the thermal bulb from the cylinder head and put it into a pan of boiling water to see if the gauge still functions- - - -it's a long shot that it might have survived, but I always believe in "Test- - - -don't guess!" Good luck!
Jerry
