sounds like your system is airlocked, remove air from the the bleed bolt. Low coolant level will cause the needle not to work as it works best when its touching liquid.
Make sure the metal coolant intake pipe which the lower radiator pipe connects to is not rusty, if its rusty coolant will not flow into the intake manifold and the gauge wont show correct temperature.
The plug for the radiator fan thermoswitch is a regular honda 2 pin round plug, but on this old Honda it used to be yellow in colour rather than brown. Its very easy to find though.
For the wiring from the actual fan relay socket, correct that melted socket, or disassemble the fuse box and route the fan wires outside. It also sounds like your electrician is a dumbass if he branched off some "fused" power to energize the coil of the extra relay he put but is perfectly OK with "unfused" load side of the relay.