A7M266 on die or in-socket temp sensor?

...and how that sensor is effected by air flow vs. watercooling. I'm having problems with my water cooling with temps about 5-10 degrees higher than my WinWBK/92mm fan setup. It's completely bled and the only thing I have yet to try is reseating the Swiftech MCW462-UH. I tried holding my old 92mm fan next to the waterblock and the temp dropped about 16C . I don't know if the die is being cooled by the fan (poor wb seating) or if the Asus temp sensor is simply being cooled by the additional air. My DD5 was recording a cpu temp about 6C above room temp (idle). That can't be right either. Can it?
Thanks

Here were my temps:
WinWBK/92mm fan--Room 28.5C--CPU 55C--Mb 37
Swiftech waterblock-Room 29C----CPU 59C--Mb 38C- DD5 CPU 34.4C (???)
Holding a 92mm fan next to the wb--CPU 43C--Mb 35 DD5 CPU stayed roughly the same

I reseated my wb and placed an additional spacer(total 2 per screw) on each screw. This shaved a couple degrees off. The temps are still way too high.
Idle- cpu (Probe)55C DD5 says 36C, DD5 ambient is 27C(Accurite temp sensor is 4C higher than DD5)
Anyone wish to contribute?

The 266 series boards read through the in-socket thermistor and not the on board diode. Currently the only Asus boards that read the on board diode are the 333 series.