BEFORE U SPENDS any money, go buy a 10-15$ electric tester. It will allow u to check ur battery, ECU and I think that temperature sensor. Fan turning on is normal, and if it does i think ur ECU is fine, its just the temp sensor. Check it.
Does anyone agree with my hypothesis?
>>>If u take car to a mechanic or borrow a hand held tester, it will show what the problem is by giving a code. Thats usualy free... I think autozone and stores like that usualy have one, i heard they can let u borrow it for a few min.
I have a 1996 Tercel guide i will be able to tell u ERROR code = What the problem is. But i need code

Last I checked those code readers are around 65$... I personaly just pray my car workds every day... If u can afford it its great. Make sure its compatable with a toyota tercel though.
>Pull out sparkplugs, they might be FLOODED. Especialy if u keep on adding OIL...
Then maybe Replace temp sensor? Its only reason it would show overheat i think. Are ur sparkplugs controlled by ECU or that distributor spinning thing? Might be distributer... It could be that or maybe wires from sparkplugs are bad ? It might be simply a fuse gone bad...
Could also be timing belt, maybe ur timing is off? Check that too
I cant think of anything else...