I was confused about that myself. I can say, that it makes a HUGE difference (obviously).
I had one of those blue "block" adapters near the radiator, and the temp there was about 140F (at least I think, because the gauge never moved).
I installed the sensor in the pan, it's about 155F to 165F...hottest getting to 170F (30 minutes of idle traffic at Car Cruise)
My point? I'd honestly go for the pan. I think it's the most accurate and I'm sure others would agree.
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