No need for high temp paint, it doesn't really get that hot. Some types of standard rattle can paint will fade over time at valve cover temps, but that depends on the type of paint and the color. Most slow drying paints (not Krylon, etc) will do a great job, and won't have any problem with the heat. Generally faster drying types of paint will have worse durability and adhesion, which is part of the compromise that comes with fast-drying convenience.

Paint flaking is usually caused by poor prep or incompatible paints. Wrinkle paints that are applied in a thin layer (spray can paints, etc) don't have much surface area to adhere to the metal or underlying primer, and tend to flake. It's the same with matte finish paints, they just have less mechanical adhesion than gloss paints.

As far as the baking goes, it's going to get plenty of heat cycles under the hood. Don't worry about it. Usually only 2 part (and some other types of catalyzed) paints need to be baked; there is a polymerization reaction that the baking speeds up, which is why baked paints are really hard and durable. It would take a really long time for the reaction to go to completion under normal temperature conditions, so in this case you absolutely need the baking. Sometime single part paints are baked too, but in that case you're helping the solvents to flash off quicker, so the paint just cures much faster. If you have a paint that must be baked, you can't rely on the engine temp to do it for you though; neither the heat or the cure time are controlled enough to ensure good results.