DMC's drawing above shows the pre-73 140 type of heater system. 73 models for the OZ market used an MCOMBU system similar to the 240s but with a vacuum-operated one-year-only-special heater tap and core,; while 74 models on used the same MCOMBU system used in 240s with a cable operated heater tap and a heater core that was used right up until the end of 240 production.
So, I wonder if the temperature spike when the heater is engaged is caused by a huge air bubble in the coolant path, caused by not refilling the coolant with the heater tap on full heat setting.
Unlike the 700/900 where the heater core is always in the cooling circuit, and cabin heat is directed by flap positions in the HVAC, the 140/240 system is 'on demand', meaning it's not always a part of the engine cooling circuit. The heater tap therefore will flow coolant though the core only when somebody winds up the heat control.
The 73-74 140/164 systems don't 'self-burp' themselves like the 240s, since their coolant expansion tank has its hose to the radiator from the bottom of the expansion tank. You'll recall how the 240 expansion tanks - and their hose to the radiator - are mounted above the cylinder head level.
What I'd do is unclip the 140's expansion tank, hold it in the air so that the hose at its bottom is level with (or above) the head, and then add coolant to it while the heater tap is set to full heat, just to make sure that all the coolant is getting into the nether regions of the heater core.