Bill,
I don't really know for sure, but:
The 261 engines had a special thermostat with a hole in it that allowed fluid to always circulate. This was supposed to help to keep hotspots and vapor pockets from forming. The risk of these hot spots and vapor pockets was localized overheating (and cracking) of the head/block.
I trust that others will correct me if I am dreaming.
Tim
