Another thing I thought of! Try another smog place, tell them you want a Pre-check only and then see what the percentages are. If OK then you pay them (again) to get the smog permit. If you don't clarify which you want they usually assume you want a full smog chec and go for a permit and its too late once they have the data print ou its already been reported to the smog police automatically (on line).
I've known Volvos with a hot wire MAF that will not pass if there is a fan directed on the front of the car during the measurement, but OTOH I know of a Mercedes that failed pre-check unless the fan was on, exactly opposite to the Volvo. Figure that one out!
A hot engine will burn cleaner and additives help so try everything then move on and good luck.
If I had one I would install A Crane optical points or a Pertronix AND a CD ignition like the one I have on my 115 gasser on it. Then I bet it would pass (and run a whole lot better too!) Just don't show me the car because I have some vulturistic thoughts (something to go with a five speed)
DDH

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'95 E320 Wagon my favorite road car. '99 E300D wolf in sheeps body, '87 300D Sportline suspension, '79 300TD w/ 617.952 engine at 367,750 and counting!