Yes that is a very common spot for W126's to rust and yes it is structual. In my book once those rails are soft the car is a beater or parts car at best.
Also if those are rotted out their is more rust under their. Start looking for cracks in the udnercoating and peel it back.
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1999 SL500
1969 280SE
2023 Ram 1500
2007 Tiara 3200
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