The heat always flows to the cabin via the heater core. The thing is the airbox diverts all the air around the core when in full cold. So the heater core gets hot, but no air moving over it. That is how 90+% of all the modern cars are (probably 99%). <-- that is suppose to be percent, not rolly eyes.
That also explains how the factory ECT can be located in the heater line. There is a steady stream of coolant passing through the line. No different then putting the sensor directly into the intake.
Block temperture isn't that critical, it is head temperture that is generally the thing to worrry about. That is why you should alyaws moniter the tempertur at the front of the intake after the water has passed through the heads. Some people find a water passage at the back of the intake (commonly the rear crossover) and try to take temperture reading there. Wow, they always have a cool running engine. Coolant flow is mainly from the front of the block to the rear, up into the heads, then forward through the heads exiting into the intake manifold and out through the thermostat housing, radiator, waterpump, repeat. Just thinking about that cycle should help with placing sensors.
