Finished it up and bought another new tstat and housing as well. The grinding/bearing noise is 100% gone (water pump), and there does not appear to be any leaking. Car did not overheat tonight on about 3 20 minute drives. Sat at autozone with AC on idling for at least 10 min (wife in car). No issues, appears to be good

So the culprit was a failed water pump (cheap part, less than 10k miles on it). Came with the gates timing belt kit. Also, the tstat housing was machined poorly, and wouldn't completely seal. I'll post pics of that later...