Everything is OEM. Spring OEM cap on the pressure tank and the radiator have non-spring OEM cap. The thermostat is OEM. Bleed and burped just fine—pressure vacuum on the radiator cap.Is the thermostat actually OE or is it a different brand? Non-OEM thermostats don't get along with the Xterra very well. Did you place the pressure cap on your coolant reservoir and the non-pressure cap on the radiator? How well is the system bled/burped?
It seems idle fine and lower speeds. It seems like more speed more volume and a potential air gap is found. It's been block tested and a new water pump.You don't need to change the temperature.
With the engine warmed up, are your hoses all tight? It's common for the plastic tees at the fire wall to fail and not pressurize the system so it over heats.
Is that high temp while sitting and idling or at speed on the road? Does it cool off when you start driving?