I pulled the passenger side internal sensor and checked the fan. It turned freely and spun up when power was applied, so I don't think there is a problem with that. The outside temperature sensor measures 20.1K ohms between pins 1 & 2, and open between pins 2-3 and 1-3. I was finally able to reset the codes (Haynes has you turning off the ignition, I had to leave it on to reset) and now I get 1-1-1 on B1. I still, however, get the fan shutting down if left on Auto or high speed manual. If I keep the fan speed low until the cabin temp starts to go down, the fan does not shut down. When it does shut down, shutting the engine down (ignition key off) and restarting allows the fan to restart. It seems like it gets into an overspeed condition and shuts down. Interestingly enough, after a shutdown, the ECU does not generate fault codes, so I suspect the fault codes had been in there ever since I purchased the car and had nothing to do with the current condition.
Any other ideas on this would be appreciated. I don't want to take the 'start replacing parts' approach unless there is good evidence that a part has failed. If I had access to another 850 I would start swapping parts, but not at the prices of new parts.