i too thought of this when mine was giving trouble, the trouble i had though like this guy is that it wasn't necessarily overheating, just loosing a load of water, a litre in 25 miles!! as long as it was toped up every so often it was fine, for 4 months or so then come the summer and it couldn't cope. i heard of that pipe causing trouble but then it wouldn't be loosing water!!
i tried kalimex Kseal, it did no good at all although highly recommended.
just got me hopes up and wasted £25.....
had new (another) block crack tested and pressure tested, machined and rebuilt with all new bits, heads in fact hole engine as you do BUT with top hat liners so they will never ever slip, ever and new rad, thermostat, pacet electric fan, water pump, oil change every 4000 and its like a new motor. cost a bit, £2700 for engine and rad but now it should last forever. (i hope)
if its a nice motor it may well be worth it............