I have a SFF Ultra microfly case, Biostar tf7050-m2 mobo.
I have my 3800@2.6Ghz and my temps at full load for 4hrs were 55-62c
They never went below 55 and never past 62..
My MCP temps were 54-61c.
Q: Can i keep running my Cpu at this?
I am running stock cooler w/Artic cooling MX-1.

I'm not sure w/o knowing the max safe temp of the cpu. Say it's 65, I'd say it's not quite safe. The weather changes. When it gets warm, the pc may overheat. You can set it up to shut down at a certain degree in bios. I think it's under power management.

no you are not in a good shape, but it can be a wrong reading from the program you are using, so try reading from the BIOS and just reinstall your heat sink, it may be possible that is not right.

Also, try artic silver 5 for your thermal grease, it can be had for under 10 bucks on ebay. I got mine for 5.95 or something like that, and I think it was free shipping. Works great. Keeps my socket 939 3500+ running in the low to mid 30's, with a thermaltake heatsink and 3 case fans.

I would invest in a aftermarket heatsink. My X2 3800 never runs over 48C at 2.7 Ghz with a Zalman 9500. AMD's will shut themselves down at 70C But anything over 60C will burn up the CPU fast (and other components). A rule of thumb is to keep it under 55C. The AS5 paste will help a lot too.