I had another go at the oil temperature sender today. I used a 5/8“–18 nut to check the threads on the sender - the nut screwed on easily. A 5/8”–18 bolt wouldn’t screw into the sender hole, so I had confirmed that something in that hole was the source of my problem.

I took a strong light, did another visual inspection, and found a piece of crud in the threads, close to the top. I managed to get the debris out of the thread using a piece of safety wire, and tried the bolt again. It went a bit further, but still wouldn’t go very far using my fingers. The top thread looked a bit suspicous - partially crossthreaded.

The problem when you are fighting with a partially crossthreaded hole is that it is very hard to ensure that the thing you are screwing in the hole is perfectly aligned. I realized that I could use the 5/8"–18 nut to ensure the bolt was perfectly aligned. I held the face of the nut against the top of the hole as I screwed the bolt in. This ensured that the bolt was at exactly 90 degrees to the hole. I was able to screw it in with a small amount of assitance from a wrench. This must have realigned the damaged thread, as I could now thread the oil temperature sender in all the way using just my fingers. Problem solved.