Ops at 100C is OK if the load being experienced warrants it ... my 350 SDL (W126) does the same thing ... maybe not quite to 100C, but close and it does relate to load.
You didn't say whether or not this has always been the case? If it has, it is likely OK, and the fuel mileage drop is not connected. On the other hand, if it just started doing this, the fan replacement likely was unnecessary since it did not substantively affect the issue.
Did the lower mileage start after the fan was replaced or before?
How many miles on the engine?
I assume you have heard about the issues with the 3.5L engines? If not, please do a search on 350 or 603 engine and see what comes up. They are renowned for their lack of longevity - issue appears to be #1 rod bending a tiny bit, followed by the piston wobbling just enough to oval out the cylinder. No one is positive why ... MB has not been real kind about following up on the problem and coming clean on it (at least that is what most of the owners who have spent $10,000 repairing their cars are saying). Mine has not yet destroyed itself ... I just removed the intake tract and found enormous amounts of coked oil in the connectors, the crossover pipe and the intake manifold. It is conceivable the combination of the crankcase ventilation of oil fumes into the intake bellows and the location of the EGR valve (just after it in the flow) could coke enough oil to build up resulting in large, hard loose particles that could be ingesting into the #1 cylinder in enough quanity to cause the bent rod ... I am just speculating, however.
I don't have an angle on the collapsed hose ... sounds like something is pulling a vacuum in the coolant system ... if the collapsed hose preceded the increase in temps, it could be the problem itself. I would also check the overflow tank cap - seems like I recall this could cause collapsed upper hose ... I am pasting in something I read about this:
From "Popular Mechanics" site:
"Well, This Really Sucks
My '93 Ford F250 diesel has about 50,000 miles. For the past few days, the upper radiator hose has been collapsed whenever the engine was cold. If I remove the radiator cap, it expands back to its original shape. Also, it expands when the engine is warm. Why?
There's a 1-way check valve in the radiator cap that lets the cap vent into the overflow tank only after the cooling system reaches its rated pressure. But as the cooling system cools down, it allows atmospheric-pressure coolant to return to the system through the overflow hose. It's stuck. Replace the radiator cap."
1991 350 SDL (200K and she ain't bent, yet)
former 2002 E320 4Matic Wagon - good car
former 1985 300 CD - great car
former 1981 300 TD - good car
former 1972 280 SEL - not so good car
a couple of those diesel Rabbits ...40-45 mpg