first foxbody (first muscle car for that matter)
 

Just took my 87 hatch out for the first time and its true what they say about the rears been twitchy lol, but the rear seemed a abit "floaty" I'm assuming its down to the tired springs and shocks....thoughts??
Also the temp gauge barely moves from cold do they run ice cold or do i have a problem.
It also idles at 1200 but that could be down to the thermistor valve been snapped in 2 and the dodgy vac lines i keep finding that are snapped or blocked off.

I had a 1984 Foxbody V6 bought from Griffiths Ford In Hinton brand new. If the rear end seems a little floaty you may need new shocks and possibly springs. The temp needle should move to the centre of the guage after a at least a mile. Perhaps it needs a new thermostat. I often complained when I gave it up for an Aerostar van (bad mistake), was that the Mustang Foxbody heated up vary fast in comparison.

The suspension is a must and will be priority.
As for the temp i drove it for about 20 mins in the city and it moved up maybe 2 notches and when I when i opened the hood the expansion tank was full and then drained out after a minute or so.
As for the rear when i grab the wheel and give it a good pull there is a clunking noise, its not a bearing it feels metal to metal.
Any ideas?

Sounds like the differential. Sounds like you need a hoist and a mechanic.

If you push in and out on the rear wheels when lifted you will get a clunk and it will move in and out slightly.

what he said, its the c-clips on the end of the axles hitting the carrier. Anything leaking around the axle seals? Its hard to trouble shoot your issues with the info given.

As for the gauge, it could be the sender unit that's bad...that's usually the case. thermostats usually stick closed and then you overheat and blow coolant every where. Even if its fried open you should still see normal temp range on the gauge after a few miles of driving.

So if you car is not overheating, look at the sending unit that screws into the block first. As for the suspension...get under there and start looking at stuff.

Thanks for the responses guys the suspension is getting re done for sure.
i will check that it has a thermostat for starters and do the boiling water test and then move on to the sending unit.
Should the overflow work as i described?

There should always be a level in it. Lower when cold. Higher when hot.

When i checked it was at the top mark then it drained after 5 mins.

Like right empty?