MRDAGERUS, you are correct. The coolant does not need "dwell time" inside the engine or inside the cooler/radiator for efficient operation of the cooling system. I'm guessing this myth has developed because a slower flow rate will likely result in a lower cooler outlet temp (but a higher average temp). I once heard the "dwell time" myth repeated in a Waukesha engine class. I had this very same argument with the instructor.
Q = m*Cp*dT
Heat load = mass flow rate * heat capacity of fluid * temperature differential of fluid across the cooler
If Q is fixed as in engine jacket water cooling, then if you double m, then dT is cut in half.
Q= U*A*EMTD
Heat load = overall heat transfer coefficient * surface area of cooler * effective mean temperature differential
In air cooled heat exchangers EMTD is the effective average temp above ambient air temp and is basically LMTD with a correction factor applied since geometry is somewhere between counterflow and cross-flow.
All other things being equal and taking temp regulator valves out of the equation, a higher flow rate should result in a more efficient heat transfer at a lower overall average temperature at the expense of pump power. However, there is a case where increasing the design coolant velocity results in a larger cooler design (explained below).
When considering how fluid flow rate affects cooling system efficiency, the main things to look at are turbulence, temperature differential, and pressure drop.
Increasing coolant velocity increases turbulence which increases tube-side heat transfer coefficient (which is one component of the overall heat transfer coefficient). Since coolant is not very viscous and is likely already in a turbulent flow regime this provides only a marginal increase in cooling efficiency. 50/50 EG/H2O coolant to air coolers typically have most of their thermal resistance on the air-side and so are more sensitive to airflow velocity but not very sensitive to coolant velocity changes.
On the other hand, oil is more viscous and so increasing the oil flow rate results in a less laminar and more turbulent flow regime, which can have an enormous impact on cooling efficiency. Oil to air coolers typically have more of their thermal resistance on the tube-side, so varying the airflow has less effect, but increasing oil flow rate can greatly increase thermal transfer efficiency thereby reducing the required size of the cooler. Since velocity and viscosity equate to pressure drop, a cooler design with more pressure drop will generally be more thermally efficient at the expense of pump power. 3-5 PSI differential across the cooler is normal for 50/50 EG/H2O and 10-50 PSI is normal for oil (specific applications may vary).
The other thing to consider is that changing the flow rate will change the temperature differential. For a fixed heat load, doubling the flow rate will cut the temperature differential across the cooler in half. All things being equal and disregarding temp control valves: a smaller temperature differential across the cooler means that the average coolant temp (EMTD) will drop closer to ambient; however, in designing the cooler, the heat exchanger application engineer must fix either the inlet or the outlet temp. If the cooler inlet temp is fixed, a higher flow rate will result in a higher EMTD and thus a smaller cooler design. If the cooler outlet temp is fixed, a higher flow rate will result in a lower EMTD and thus a larger cooler design. How big of an effect this has depends on how close the fluid temp is to ambient.
Take for example an Engine Jacket Water (EJW) section and a Turbo Aftercooler Water (TAW) section designed for 110 F ambient air temp:
The EJW is to be designed for 190 F at cooler inlet. At a given heatload and flow rate, let's say the cooler outlet temp is 170 F. If you double the design flow rate, the outlet temp is now 180 F. Since the average temp above ambient increased by about 8% and you get a little tubeside bonus from increased turbulence, the cooler can be designed maybe 10% smaller.
The TAW is to be designed for 130 F at cooler outlet. At a given heat load and flow rate, let's say the cooler inlet temp is 160 F. Doubling the design flow rate will reduce the design inlet temp to 145 F. The average temp above ambient decreased about 22%, but you got a tubeside bonus from the increased turbulence so your cooler design might be about 16% larger.