Hi Ian
I was here a few days ago with the same problem with same age/make of car - presumably you mean you can't get heat in the car? See if you can find my post - "Laguna - Why no heat" as I'm now sorted. There are quite a few posts on the site with this problem so have a hunt around as I'm no mechanic but others seem to be.
Re Thermostat....mine reads on the low side (sits at about a quarter) and it's a new one.... the mechanics who worked on my car said not to worry too much as they're not a perfect indicator as they also act as an oil level too.
Re heater problems ..if it is your matrix...they said that it's ridiculous that when these cars were built they built the dashboard round the matrix which makes it a very expensive repair due to the man hours needed to get the matrix out ... dismantling steering wheel etc. They also advised against using a corrosive wash to go round the system as this can damage rubber hoses or connectors - he had found that a short squirt of washing up liquid sometimes did the trick and loosened the particles.
Good luck and I hope you have as straight forward a solution as I did.
Kg
February 2005