On my Euro 190E 2.3-16 the thing you have circled in blue in the first photo is the unit. However, you are missing a little black cap with green lettering ("N" and "S" with numbers between them arranged like a watch face with the letters not quite diametrically opposed) that has an array of resistor circuits that go from the center pole to pins on the outer periphery (still under the cap). Looking at the socket in your car I see the arrangement is a little different, and yours may not be the same as mine. On my car you set the timing by aligning the "N" for normal gas, or "S" for super or high test gas, with one of the clips that hold the cap on. One spot has no resistor or connection (infinite resistance) for advancing the spark timing as far as it will go.
If you use really good gas does the problem go away? If not, you may have something else going on.
I hope this helps, Jim
1986 Euro 190E 2.3-16 (291,000 miles),
1998 E300D TurboDiesel, 231,000 miles -purchased with 45,000,
1988 300E 5-speed 252,000 miles,
1983 240D 4-speed, purchased w/136,000, now with 222,000 miles.
2009 ML320CDI Bluetec, 89,000 miles
1971 220D (250,000 miles plus, sold to father-in-law),
1975 240D (245,000 miles - died of body rot),
1991 350SD (176,560 miles, weakest Benz I have owned),
1999 C230 Sport (45,400 miles),
1982 240D (321,000 miles, put to sleep)