I am going to try and cover the aftermarket thermostat kit, I am going to admit, I am not a fan for the properly built marine engine, but (this is going to sound hypocritical) we put one on the small block powered Southwind, mainly because the engine is a small Chevy that was built with automotive specs. What can I say, the motor was practically free...

The thermostat kit I am speaking about is the one with four hose fittings and the two tees.
Now the basic principal is pretty obvious, but how it achieves the issues with over pressurization is pretty cool.... This is why I do not think the stat kits require any sort of regulator, but I digress...
The thermostat gets installed in the normal spot it would be in a car. The difference is in the thermostat itself, a marine thermostat is made a little differently and tend to be either 140*F or 160*F, they will have a small check valve in them to let air flow out and a tiny sample of water to go through to be able to sense the temperature.
The bypass feature in the housing is pretty slick... What it consists of a plastic plunger and a spring that keeps a constant pressure on the feed water and a pressure differential across the engine block, when the pressure gets past a certain point (the spring pressure) the plunger releases the excess water to the (insert system here).
The proper plumbing for this is really straight forward.
For logs;
From the pump to a valve (even if it is wide open 100% of the time, install a damn valve in case something fails...) to an open tee, from the tee to the logs, out of the logs into the front water pump holes via the supplied tees, from the top of the tees to the stat housing top two holes, the bottom two outlets of the stat housing go to the risers.
For OT headers;
From the pump to a gate valve (or whatever) to a tee, from the tee to the block holes via the supplied tees, from the top of the tees to the top two ports on the thermostat housing. The bottom two ports of the stat housing go to a properly sized dump line and the other goes to a Bassett tee or manual valve for the header cooling, this system will be pretty reliable, I personally would use a 1/2" inside diameter dump line fitting for engines up to about 400 HP. The set up of the Bassett tee is the same for a valve only, run the engine to approx. 1500 RPM and increase the valve setting until the header start to mist... DONE!
On both of these systems the engine water temperature will be pretty consistent, but don't expect it to be balls on all of the time, the stat needs time to react to different conditions, hard acceleration and deceleration will cause little temperature swings here and there, IMHO completely normal not to mention harmless.
A word of caution on these systems... Don't get caught up in the system being bullet proof, it requires maintenance and tuning on occasion, there are moving parts, moving parts fail.
Perhaps a better alternative to this package is the ones found on a stern drive type deal... Block mounted water pump, recirculation hose, works awesome and can be bought stupid cheap.
GT