Does anyone know if the ambient air temp sensor has anything to do with the operation of the air conditioning system in our trucks or does it just provide an outside temp for the compass/ outside temp display? Also where is the sensor supposed to be located at? My truck did not come with either of those options but I am putting a/c in it and not sure if I need the sensor or not or if it is already there any info on this would be awesome thanks!

The ambient temp sensor should just be used for the display. The ECM probably uses a different sensor for ambient, at least it does on a 3rd gen.

I don't think it has anything to do with anything other than the overhead.

1998.5 to 2002 the ECM uses IAT temp primary but not limited to that it can use also the battery temp sensor too which PCM delivers the information over the CCD network. But the sensor ISX shows is only for the overhead display.A/C system doesn't use any external temp sensors other that the low pressure switch which tries to detect freezing temperatures of the A/C system and shut down the compressor if it is occurring.

Thanks for all your info! It was very helpful!