No heat...brrrrrr!

Noticed on the way home today that I had no heat in my '93 4 cylinder. Also, the temperature gauge seemed to be sitting higher than normal. So I moved the heater switch from hot to cold and then back to hot and I had heat and the gauge started to go down. Weird??

Does this sound like a thermostat problem? Maybe a water pump issue? If the thermostat fails does it normally fail in the open or closed position?

I hate to admit it, but I've had the truck for about 8 years (100 000 km) and have done nothing with the cooling system. I know, I know, you're supposed to flush and change the coolant every coupla' years.