wrong port boost above stock
 

Alright so I have a stock 2004 Dodge Ram2500. It had an engine replaced at 90k from previous owner its the 325hp H.O. im at 122k whole engine is stock minus the 4" MBRP straight pipe exhaust that came on it. My gauge is mechanical and its reading 32PSI max would having the larger exhaust give me better flow to a higher reading. Also is where the sensor for the gauge a huge factor in reading boost pressures? I have mine in the intake manifold instead of the horn, is there a difference between the two as far as how much it will read?

No a larger exhaust wouldn't give you a higher reading. Plus, since your truck is stock, i wouldn't recomend maxing out your turbo. 32psi is staring to push your turbo at it's limit. If you want to reach a higher psi, you'll need to start doing some upgrades.
Your gauge is installed in the right spot.

you should prolly check the turbo too see if it has a boost elbow idk if thats how the cr turbo works or maybe it has a boost fooler you dont know about.

I was thinking about the boost fooler but I have not been able to just get in there and check. As well as the boost elbow...im quite sure neither of those have been installed. But never know. If I have neither what would the cause be? Possibly a damaged gauge be the culprit?

I can definitely see the damage it would do to the engine in which making it run lean would cause some internal destruction. If I ran to a little to much boost for a long period of time without the proper upgrades to go with it.

the turbo could go,you could do some engine damage or you could pop a head gasket for example.