This is the gasket I have. Is this the one you were referring to?

http://www.autozone.com/autozone/par...er=225145_0_0_

You will have 2 gaskets. The one for the housing itself that looks like this:

http://www.autozone.com/autozone/par...er=157141_0_0_

And the one for the thermostat itself, looks like this:

http://www.autozone.com/autozone/par...ier=84982_0_0_

*note* Not sure if those are the actual parts, but rather references for understanding.

If there is no rubber ring gasket, like the second one, coolant will flow around the thermostat.

I am having trouble remembering if I even bothered with a paper gasket on mine. . .

Ah yes! I was thinking while I was doing it that would be a good spot for an o-ring but I didn't see one come off the old one so thought I was imagining it. I used the silicon instead of the paper / rubber outer gasket because it seemed useless

Ummm.... Problem solved? LOL!
Git 'er Dun!

I'd say so. I bet I can find that o-ring in my old radiator. She'* been running like a completely different car since the coolant system rebuild. So much more power! I bought her in rough shape so this is my first taste of it. can't wait to get her up to temp. The gas mileage actually seems to be up quite a bit even with the stat situation, and she was getting over 20 highway/city mix before

Unless the previous owner didn't put it in when they replaced it.

Makes me realize I need to see what is going on with mine, and it sounds like mine is running stronger than yours was.

That'* a good point. It'* a bit of zip tie haven in some areas from the last guy, but I'm a pretty firm believer in the power of zip ties so I'm not bothered by it too much. I've sunk a lot of time and money into it for the past two years for an old car and finally seeing it pay off. I'd like to get another 75,000 out of it, but we'll see how that goes

Yup...rubber gasket.

Just put her in and replaced a bypass hose clamp. letting the silicon on the housing set for a while and I'll test her out in the morning or maybe later this evening if I'm feeling lucky. It'* a nice snug fit, that'* for sure. I take it the spring on the stat is pretty strong?

Fixed! Thanks for the help. Rookie mistake