How can it be ok for a 94 Z28 to run safely at 240 degrees F wouldn't that be hard on the engine?

Yes Very Hard On This Engine240 Degrees Fahrenheit seems excessive. I have seen some engines run as high as 220, but for this engine I would think 240 is above the normal operating temp. I would perform a complete cooling system service including replacing the thermostat, checking the water pump, cooling fan, flushing the system, and cleaning the exterior of the radiator fins.

Yes, it can be very harsh on the engine. What you can do is order a temp. relay for Summit Racing Equipment. This relay will start the cooling fans before 240. Which will keep you on the road that much longer and protect your engine from blowing.