Choosing cables for high amperage
What's confusing is that I also have a hall sensor rated for 200A that only uses 10 Gauge wire. Is it ok to use the higher (ie. thinner wire) gauge when working with shorter distances? Or will the hall sensor wires burn up when they exceed 55 A?


There are two considerations for correct selection of wire guage:


Acceptable voltage drop along the wire. The smaller the cross-section the higher the resistance and the voltage drop.
Acceptable temperature rise as a result of power dissipated in the cable's resistance.


You should be able to work out the first from cable gauge resistance tables.

The second is a bit trickier. You can work out the wire resistance per unit length and work out the power dissipated per unit length from \$ P = I^2 R \$. The heating will cause the temperature of the wire to rise until the heat lost to ambient = resistance heating. What temperature this occurs at depends on the wire insulation, the ambient temperature, air-flow, etc., so it's difficult to work out from first principles. You might get some ideas from multicore cable ratings or conduit cable ratings where the inner cores are not exposed to free air.