I worked on the car for a bit today, and I was able to install the oil cooler adapter upright!!
This means, thermostat will operate based on NOT the cooled oil coming from the cooler, but rather the hot oil coming out of engine. In my case, since I have an over-sized oil cooler, the difference can be huge.
Once I made sure nothing leaked, I went out for a test drive. I hopped onto highway, and set my speed on cruise control @65MPH @4300RPM @3rd gear @~30 degreed F ambient. The V8 quickly starts heating up at high RPMs, but this time, instead of keeping the climb, it has stabilized at 233 degrees, and never went above.
Of course, the real test will be at the track. Weather permitting, I will attend a track day on this Saturday. Michael @Improved Racing has also sent me a few parts to test if I need to (an oil cooler adapter with no thermostat, a 180 degrees F unit, different fittings, etc.), so if this is not the end of this saga, I will get to the bottom of it no matter what!
Note: I also updated the how-to post regarding upright install option.