The usual tips apply.
Look for leaks, engine noise, rust,uneven tire wear, and overall condition. The timing chain is definitely an issue. If the car has 120k+ - it should have been done. Any slack in the chain is a death sentence for these engines.
These are great cars, and there are many out there that have been well cared for. Remember that these cars cost as much as a home when new. Before I bought my 85 500SEL I drove several W126's (even one's outside my price range). That way I knew what to expect, and was ready to pounce on a great deal.
If they won't let you drive it on the freeway - forget about this one. If the car tends to overheat, you dont want it, and a good test drive is the only way to verify.
Trust your gut. Mine fires right up on 3 cranks, and you practically have to look at the tachometer to tell it is running.
Best of Luck