The official normal operating oil temperature for a Twin Cam engine is 230°F per H-D. Of course, since these are air cooled engines, the actual temperatures will vary fairly widely depending on operating conditions. If the outside air temps are significantly higher or lower than 70°F, then your oil temp will also vary accordingly. If you are just cruising easily down the highway, the oil temp will be lower than if you just hammered it for 30 miles. In other words, there is no one single "normal" oil temperature.
The way to use an oil temp gauge is to first get a feel for what your particular gauge reads under the various conditions you usually ride in. Let's say in your case it usually reads somewhere between 210°F and 250°F. As long as it remains in that range, you have nothing to worry about. If you suddenly see a significantly different reading, then you need to look for possible causes.
As for the dipstick gauge, they don't have a sterling record for accuracy or durability. They are also not a real time solution, unless you plan to lean down and push the button as often as you would normally sweep your other gauges with your eyes. If you have the ability to mount a real direct reading gauge, it is the much better solution.
Jerry