This is how I resolved my friend's 81 300SD blowing lot of white smoke. Disclaimer - I am not a mechanic by training. It may not apply to your smoking problem but you can take it into consideration. This is how I arrived at the turbo problem after my elimination methods.

1) The car runs on WVO but it starts every times so I discounted the rings. I did NOT do a compression test. I would have done it if I have the tools, I don't. Also it is more difficult to do compare with a gas engine.

2) I drained all the coolant when the car is cold. Started the car ran it for a SHORTWHIILE until the engine get hot. It still smoked a lot without coolant. Car was not losing coolant at all, so I discounted head gasket. Also my friend said he did a radiator pressure tested and found no leak. Do this at your own peril.

3) Smoking is continuous at idle. Not at startup in the morning after car is sitting for a long time. So I discounted the valve seals or guides.

4) Adjusted all valves and it still smoked.

5) Suspected very strongly is the turbo seal leaking oil. Changed out turbo and problem solved.

This is my experience and hope this info helps to resolve your smoking issue.

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Not MBZ nor A/C trained professional but a die-hard DIY and green engineer. Use the info at your own peril. Picked up 2 Infractions because of disagreements. NOW reversed.

W124 Keyless remote, PM for details. http://www.peachparts.com/shopforum/mercedes-used-parts-sale-wanted/334620-fs-w124-chasis-keyless-remote-%2450-shipped.html

1 X 2006 CDI
1 x 87 300SDL
1 x 87 300D
1 x 87 300TDT wagon
1 x 83 300D
1 x 84 190D ( 5 sp ) - All R134 converted + keyless entry.