I think there might be a problem with water not flowing enough trought the block, because if the majority of the flow goes in where the thermostat is located and back out to the swirlpot. You only get water flowing in the head and not so much in the block.

It seems to me that a 4wd thermostat if having the thermostat removed and not blocked of properly will cause to much water to flow past the engine with a Craig pump. You could get around this with a special washer with the right size hole instead of the thermostat that restrict flow enough so water goes into the engine.

My solution would be to instead of having the thermostat connected you remove that or use a 2wd one, so the hose from the Craig pump instead goes to where the waterpump is located in the block.