So, Mike, if you remove that t/stat housing, there is no passage into the block?
I understand that the branch pipe has to be the return, looking at the motor, that is the same configuration as a Volvo whiteblock. centrifugal draw, pushing from there into the block & head.
However, I would expect that coolant is passing from the block into the backside of the t/stat housing, heating the t/stat & allowing circulation of coolant from the pump, through the block/head, and back to the pump. Otherwise, how are they expecting the heating block/head coolant to circulate? Typical coolant flow through the t/stat matches what I'm saying - coolant flows from the spring side outwards, not the other way, so that would still mean the t/stat is the feed side & should be going to the top of the rad.
EDIT: nix that thought process- on yours coolant has to be returning to the t/stat, or it would be counter productive / conflict with the coolant path. So that would suggest a blockage in the housing/block sicne there has to be a means for coolant to return to the branch from the head&block besides the small hose going to the branch pipe.
The feed to the rad up top will be static until the t/stat opens, just like a closed heater circuit. Which still means coolant has to therefore circulate internally back to the branch pipe in back of the t/stat housing, I can't see another sensical path
Have you pulled that t/stat housing to see if it flows through the block?
EDIT again. Bottom line, coolant has to be able to return to the t/stat housing & branch pipe internally, or there is no circulation within the motor.
EDIT again. Looking online for B16 coolant pics, can't find anything complete & really accurate. Seems like it relies on that small hose coming off the head (through a intake passage) back to the t/stat to circulate head, and the heater feed below at back to circulate coolant from the block. Doesn't make sense as if the heat is off, then you have no block circulation beyond what is transferred out via the small head passage?? Can't make a clear mental picture here.
Sorry if I'm just adding to the confusion.