You likely need a new CHT sensor. However, I'd check to see if you have a stuck thermostat first. Thermostats can stick open or closed. Yours is likely to be stuck open from your conditions. Like Bluefront wrote, MPG will drop tremendously when engine temps are low. Combine that with an old fuel filter, bad gas, and other typical MPG robbers, and you're getting 22 instead of 32.
The first thing to do would be replace the thermostat. My reasoning is that it's cheaper- about $10 to replace the thermostat and gasket, and that might fix the CHT sensor as well. I have no idea what a CHT costs, but if you still can't get the gauge to work, I'd definitely contact Mike at Hilbish Ford and get a new part. The car won't blow up without it, so there's no sense in paying to get one sooner than Mike can ship it. After replacing the thermostat, warm the car up, and check engine temps as Sleepyboy suggested using the odometer. If you need a How-To on that, go to our home page and click the "Member's How-To Archive". There should also be a How-To in the Complete How-To Archive stickied to the top of this forum.
If you get the gauge to come up, and things seem to be working better- I'd consider going through the typical MPG robbers starting with the cheapest- like the fuel filter, air filter, and ending with the O2 sensor if the others don't increase fuel economy sufficiently. As a general rule, I try the cheapest repairs first in these situations where I can't pinpoint a single cause through diagnosis.
