Overheating

Ok so the alternator went out on my car, I got underneath the car and unplugged the one wire going to the alternator for the voltage regualator becacuse it was chaffed. I also had to unplug the wires going to the oil pan because there was no slack. After it was all plugged back in, the temp gague automatically went to 3/4-7/8 of the way to hot when the car was started from cold. I got the car to a shop where the alternator was replaced and troubleshooting for the over heating started. They swore up and down the water pump was bad. When the car was plugged in to a doagnostic tool, the temp gague was high yet the car only registered at approx 150-170. The shop did the timing belt, water pump, thermostat and flushed the cooling system. The coolant came out rusty colored. The heater stopped working unless at high idle or engined reved. The shop said that the heater core went bad, but it worked when I dropped the car off with them. The shop also suggested that the temp sending unit went bad. After a phone call from my wife, the shop decliined to do any more service on the car and had failed to fix the overheating. I drove the car home and after about 3-4 miles and less than 5 minutes, the temp pegged hot and the temp warning light on the information display came on. Before I throw any more money at the problem, can you give me suggestions as to what could still be causing the problem? I have the car prepped to pull the heater core if necessary, and the temp sending unit is cheap. I would just like further guidance before I get any further.