Sounds like you may have a couple of issues. Bleeding the air out of the coolant system as stated above, and a bad wire/connection to your temp sensor. The temp sensor is located in the driver's side head between spark plugs 1 and 3. If the wire or connection to the sensor is bad, your temp gauge will jump around.

 

the sensor thing sounds right, as no way it should jump around that fast, I'll check that out tomorrow....