[fredjacksonsan]

With the low indication, it could be the guage itself.

BUT... with the dropping coolant level (and no leak) and the residue on the dipstick, your dealer just might be right. It's worth the afternoon spent to replace the head gasket to find out. While you're doing that, you might also want to check/replace the water pump and gasket. Good luck, interested to hear how it comes out.