On my '96 2.5TL I have to crank it up to 90 to get luke warm heat. Also, my temp. gauge reads just above the cold mark. My coolant is full and looks good, so i'm thinking the core is good. Would this be a engine thermostat?

 

I would start w/ a new thermostat, as this is fairly inexpensive. Get an OEM thermostat since they provide better warmup time and temperature accuracy.

good luck

 

Yes, change the thermostat. I have a '96 TL that had poor cabin heat and the water temperature gauge was just above cool. After changing the thermostat, heater gets hot quickly and the temp gauge reads just below midline.