There are three components in your list of suspects, and yes, the sensor is probably the more likely of the three to cause an inaccurate reading.

Here's what I would do. Check the instrument voltage stabilizer first. It is so easy to do. All you need is a multimeter on voltage range. Pull the yellow wire from the sensor terminal at the cylinder head, turn the key on and measure 10 volts on the free end of the yellow wire with respect to the negative post of the battery. Run the engine briefly and ensure it stays right at 10 volts, not 11.5, not 13. If it sticks at 10V you've eliminated one not-so-likely cause.

Assuming it isn't the stabilizer at fault, I'd swap in a new sensor. They're not expensive and you don't have to drain all the coolant to put one in -- just be quick with the replacement.

The third item is, of course, the gauge itself. Not so easy to source and replace unless you're lucky to have a spare panel.

Then, there's always the possibility some flow problem exists in the head affecting the sensor's ability to be in the mainstream of the cooling. Well, that's one of the things a high reading is supposed to warn about, but I haven't seen it happen yet among my small fleet.
--
Art Benstein near Baltimore

The reason a dog has so many friends is that he wags his tail instead of his tongue.
-Anonymous