[RIP]

When you are at speed, the cooling system is working at it's peak capacity trying to maintain cooler temperatures under load. As you come into town the demand on the cooling system declines. If coolant flow is resistricted, the temperature will rise above the normal range. A restriction could be a weak pump, partially clogged radiator, partially closed thermostat, or a collapsed hose. Could even be as simple as old/weak coolant or a slipping surpentine drive belt.

If you haven't in the past two years, I would drain and flush the system and change the thermostat at a minimum. If the hoses are 4 or more years old, consider changing them.

Yes, a leaking head gasket can create a knock. Coolant leaks past the gasket thinning and decreasing the lubricating capacity of the oil, allowing parts to wear faster. That said, if you aren't seeing water vapor coming out the tailpipe and/or notice a decreased acceleration or missing, you're probably ok. Another sign is oil in the coolant or visa versa. You likely won't see it on the dipstick but, if you drain the oil it will appear a lighter brown and may have whitish swirls in it if contaminated by coolant. Coolant will have tiny black dots or a heavy rainbow appearance on the surface. A compression check can reveal a bad gasket.