I can't answer to many questions on your piston ring situation but I do know as your machine shop said they did switch over to I believe 1/16 inch rings compared to the old 5/64 ring size. The only thing is to have the right pistons with the right rings and also compression height as many rebuild pistons have like 1.540 compared to a stock 1.560 piston height but it will vary from maker to maker. As far as the thermostat I can't give you a complete answer but it works hand in hand on the entire cooling system and other factors. For me a 160 is fine during city driving but to cold on the highway and just awful in winter time.
The 195 always make my engines run to hot on my trucks so I use a oem 180 thermostat on it and it runs 190 to 200 all year round up here in Ohio and never runs to cold or hot and the temperature is always steady. I don't know if this will help or not but I know on the cherry picker from harbor freight you can also buy a load leveler and you can adjust how far and back it goes but I don't know for sure if it will give you enough or not as I have yet to use one but have seen them used before.
3/4 ton Capacity Heavy Duty Load Leveler
The 195 always make my engines run to hot on my trucks so I use a oem 180 thermostat on it and it runs 190 to 200 all year round up here in Ohio and never runs to cold or hot and the temperature is always steady. I don't know if this will help or not but I know on the cherry picker from harbor freight you can also buy a load leveler and you can adjust how far and back it goes but I don't know for sure if it will give you enough or not as I have yet to use one but have seen them used before.
3/4 ton Capacity Heavy Duty Load Leveler