On a 325 this age, I would look for a water reservoir that is crumbling inside, causing the cooling system to suck in air. Air might cause overheating at idle but not at higher RPM. The 318 uses a different tank so I don't know whether sucking air is a problem with this tank, but it costs only $20 on line for an OEM tank.
The thermostat may have stuck shut that one time, but generally when a thermostat sticks, it stays stuck.
The electric fan should come on whenever the A/C compressor is running or when the water temperature is high. You can check the function of the water temperature switch, the relays, and the fan by jumping the connections on the plug for the temperature switch that is in the end tank of the radiator. On a car this age, the relay for the low speed of the fan is probably overdue for its first replacement if that has not been done. I replaced the low speed relay in one of my '97s just a few weeks ago.
Check the fan clutch to make sure the fluid has not leaked out of it. You don't want the fan clutch to fail completely and come apart because the fan will chew a hole in the radiator.