You have faith my brother in that 99 cent thermometer from China. Send me some money, and I will heal you! lol
So many variables. Start with the temperature probe.
Alot depends where the probe (thermostat temperature sensor) is located. If located in a cooler location, then yes, the cage can be warmer around the heater.
99 cent thermometers are good for nothing but "near the ballpark" readings, not even in the ballpark. They have a potential large error, especially when reading temps 20 plus deg above room temp. When you consider that suppliers sell thermometers for hundreds of dollars that provide a known accuracy within a temperature range, then you can see that a 99 cent thermometer cannot provide an anywhere near comparable accuracy.
If you are warming an object, spend the 15-25 dollars on a non-contact thermometer - so many suppliers on this sight sell them. If you are measuring air temps, then perhaps a digital thermometer sold at various stores. Although inexpensive digital thermometers still have an error of plus or minus 2% or whatever their label says (for 100 degrees, you can see that plus/minus 2% is quite alot), at least they have compensation built-in to keep the error typically within those limits.
If using CHEs or radiant heat panels, air temp can be deceiving. Air temps can be 75 deg but surface temps below can be well into the 80s. Best to use a non-contact thermometer on the object being heated.
You adjust the thermostat to provide the desired temperature where you want it. You place the thermometer where you want the desired temperature to be.
I wish I could provide more help, but I can't see your setup. If you would like, fire off more questions and include a bit more specific info on your setup.
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Mark