Moving the thermistor UP/DOWN is a means of affecting temp control (thermostat) on those MODELS that use 'AUTOMATIC TEMP CONTROL'
Those models that have temp settings (1-5 & 1-9) the thermostat control temp range is calibrated/based on OEM position of thermistor on specific FIN
FIN temps are ~10*F colder then compartment temps
Disconnecting themistor from fin and laying it on the shelf or hanging down etc will cause very cold temps in food compartment because thermostat has NO feedback of temp so it OVERCOOLS
Althought your thermistor 'tests' good........it is NOT functioning properly
You need a new thermistor.
Unfortunately the thermistor wiring is difficult to replace.
Fortunately there is a product that allows for replacement if just the temp probe......with rheostat that will allow minor temp tuning (6*F-8*f)
Snip-The-Tip
https://www.snip-the-tip.com/cgi-bin/articca.cgi
You stated with thermistor on shelf you moved temp setting from 'coldest' to one DOWN
Your old 1999 vintage fridge cooling unit is slowly dying
Otherwise with internal, external fans on no thermistor temp feedback the food compartment should be less then 32*F on 'warmest' setting (freezer temps should be 0 or lower)
20 yrs is pretty good service life for an RV Absorption Fridge