I agree with Larry.
Having driven both models with automatics, the 260 is noticably slower, but otherwise the same.
The 260 owner has reported that his fuel mileage is not any better than I get with my 300, though I do have a manual transmission.
Expensive potential problem areas include oil leaks, head gasket failures, air conditioning, and front suspension/steering issues.
I will say that I have almost 200k miles on my 300E without the dreaded head gasket failure, though I do live in a cooler climate.
Overall reliability is really very good, which is evident by how many folks are out there with 200k+ who are still happy.
I would certainly be more concerned with the overall condition than the 260 vs. 300 distinction. The W124 is a fantastic chassis.
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