Still one odd point about your enquiry.
If I turn the Cylinder Stat down from 80 to 60, it clicks and the boiler fires.
If that is correct the thermostat has its NO and NC wiring transposed. But from your other comments, I will assume that it's your typing that is transposed instead
So I think your question is why your cylinder thermostats isn't accurate. First of all most use 40 year old mechanical technology a 5 to 10 degree difference between switching on / off when the dial is moved manually is not unusual. They get away with it to some extent because a few degrees variation on a hot water temperature of 65 degrees is not all that noticeable. (unlike a few degrees variation in a room temperature for example) There's no real point improving this accuracy, which is why it still exists, because there is a bigger influence out there.
The temperature marked on the thermostat dial is there to provide an indication of the usable hot water temperature, but the problem is that the temperature right at the bottom of the cylinder where cold water comes in could be 10 degrees, and at the top it could be 65 degrees, so in reality, the temperature of the water ~one third of the way up where the thermostat measures it, will be cooler than at the outlet to the taps at the top. This will vary from property to property, installation to installation and fluctuate depending upon your water usage pattern, the temperature of the incoming cold water and even a slight variation in mounting height.
So, the manufacturers have to take an average 'punt' and at the same time for safety, ensure that the cylinder doesn't overheat and scald anyone. So, I find the vast majority of cylinder thermostats function exactly like yours does. Having been asked this question a few times now, I usually advise users to turn their thermostat up if their water is too cold or down if it's too hot, regardless of the temperature indicated on the dial.
One third of the way up is the correct location for the thermostat for it to provide a reasonably full cylinder of hot water before it switches off, and for it not unduly effected by the cold inlet at the bottom.