No, do not put a higher temperature thermostat in the engine, you just need a thermostat that works. Thermostat can go soft in as little as 2 years. The VW ECU has a VERY POOR threshold for flagging a bad thermostat with a CEL, an engine can run 165/170F all day long without ever triggering a fault code.
You NEED an OBDII tool that can read Live/Real Time data, again, if you have a smart phone or Windows laptop, $30 tops is all you need to spend.
As for replacing the thermostat, it is not fun, but can be done with the proper tools without removing the alternator. It is located behind the alternator.
Read the link in my signature for more info.
I would either drain your current oil and save it in a clean container and switch to Mobil 1 0W40 and add SeaFoam or STP and make sure the thermostat is good or pull the pull the oil pan and replace the pickup. Even if you try the Mobil 1 with the SeaFoam or STP you may still have to pull the oil pan, but it is an attempt to clean up the oil pickup without pulling the oil pan. It you are lucky it may work, you will need to let the engine idle for a while to really get up to temp and try to drive carefully and "manage" when the oil light pops back on, putting the engine in neutral and letting the oil pressure build back up. If you are lucky you may be able to clear up part of the pickup within a few days or a week, an then continue to drive the car.
Engine temp will be the key here. You live in Canada, ran dino oil and probably had a bad thermostat and the crankcase was contaminated with water and it never boiled/cooked out.
See this picture of a typical oil fill cap with mayo on it due to too much water vapor in the crankcase. Also your engine oil probably turned black very quickly.
BTW, the orange pieces in the oil pickup are parts of the dipstick tube, I am on tube #3, assume your has broken at the base and been replaced at least once?