I'm glad that you got it resolved and at a reasonable cost. I think your experience here yields two important take home points for others.
Firstly, how invaluable having a copy of VIDA and the wiring diagram are to a methodical, well reasoned diagnosis.
Secondly, whilst the fault detection and reporting capabilities of the car's control modules are very good (particularly for the period of their execution), they were designed to a price point and thus are not fully exhaustive nor with it infallible. In this case, the CCM's internal error checking routines were able to pick up that the measured temperature value was outside of the expected plausible range but weren't comprehensive enough to be able to really determine the root cause. i.e. distinguish a failure of the sensing element from that of the sensing circuitry itself. All it could do was raise the generic "sensor warning light" and let you do the rest. Or to put it another way, DTCs don't really lie as such but it's often important to understand their context in terms of the way in which the associated systems work and their relationship with others.
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2007 XC90 V8 Sport
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