AHA!! The same problem I ran into on my 59 GMC 370. It has the same deluxe heater as yours. My core was in perfect condition, no leaks. But the control valve was rusted up and leaking. As was mentioned before, some of us cannot spend $72 for this and $225 for that and $350 for that. Its a never ending money pit, even if you are just going for a daily driver and not a trailer queen. So you have to draw the line somewhere....
Here is how I fixed mine for less than $10.
I ripped off the old sensor box, soldered up the hole in the tube, got a new rubber elbow at NAPA for (something) for $4, went to the junkyard and got an inline valve for $5. Then mounted it outside the firewall in one of the hoses, then ran my control cable from the dash out to the valve. Same thing Bill says to do.
BUT---if your a purist, spend the $72.
