Well, Ray, first of all it is expecting to work at 6 volts, so you would need to find one that is suited to 12 volts. Poke around elsewhere for a 12 volt version.
I have heard both arguments that a simple capacitor in parallel with the gauge needle coil(s) will or will not provide a dampening effect. Both of these arguments may be right, depending on capacitor (value and characteristics) used, as well as the meter movement used in the gauge - you’re developing a semi-tuned circuit, after all.
OTOH, an ultra capacitor might just do the trick, again, depending on the gauge movement.
Either way, $28 buckeroos for what appears to be an ultra capacitor is a little stiff (or that little wiring harness has gold-plated wiring or something).
But you’ve piqued my curiosity about ways to do the dampening effect so I think I’ll look into it and see what I find. I’ve always thought that if you were to somehow average out the variable voltage produced by the sender as the float moves, you could get the needle to show an average which would be close to the actual level. An ultra capacitor might just do that.
Stay tuned.