The reasons of heating up of the coolant coz of A/C can be diagnosed as follows...
a. Choked condenser with dirt, bugs and/or mud layered up between fins. And also bent fins stopping the airflow thru it. If it is so, it can be cleaned with mild caustic soda solution and garden hose, NOT jet wash unless when the person doing it has got excellent control on spray and knows the strength of material he is dealing with. And even during general service washing, getting condenser / radiator blown thru with air hose is much effective than water jet.
b. The gap between condenser and radiator...This comes almost sealed from the factory with plates, gaskets and dense foam. With time, these things vanish somehow...allowing partial flow of surrounding air bypassing the condenser and not all the air sucked thru it. Thus reducing airflow thru condenser and making it hotter than usual which eventually increases coolant temperature in radiator and decreases cooling in the cabin. Those gaps (from all four sides) should be sealed as good as possible.
c. The choking of radiator itself. Same reasons as in point (a.) about condenser with an addition to its interior cleaning for proper flow of coolant.
d. The fan shroud plays a very important role in this whole matter. Make sure its complete and aligned properly with the fan to give almost equal gap that is usually around an inch from all sides with slightly more on top to accommodate engine movement during hard acceleration. It should be less than an inch visible out of shroud when seen from top.
e. Clutch fan is better specially for city driving as well as a new thermostat valve for the life of engine.
f. Coolant may not cool the engine any better than water but it will help reduce / stop build-ups or rustic material in the cooling channels that are mostly impossible to reach other than just the radiator. That hugely reduces the coolant flow and might effect water body / water pump's life over a longer period of time.
g. In case there is only one fan, i.e. the engine one, a high speed electric fan on condenser will help the air flow in a big way and increase cooling both ways.
h. If the engine is replaced with a different category, i.e. from an L series to KZ etc, and the temperature gauge remains stock, there might be a difference in its 'normal' position being calibrated / designed for a different engine.
Regards