From the sound of it, I doubt your engine is anywhere near dead. Nitro engines are more durable than what everybody makes it out to appear. Mechanical failures are the only real way to kill em.

As for the increased temperatures, when your running on grass, the engine has to work harder to move through it. So there is more fuel burned = more heat. Notice how you have to use more throttle and there is more clutch slipping just to get going from a start to a roll. That and since your speeds are drastically slower, there is less air flow over the engine to cool it down. So you can see 2 things there, less velocity and more work = more heat.