First the steering linkage is affected by height but does not cause height problems.
On the 124 body the strut plays a larger role in the geometry of the suspension than previous shock systems and a broken piston or deflated pressure could alter the height.
To a certain extent worn (or deflected) lower control arm bushings will cause the arm to extended and the front end to squat. This should be apparent in alignment and is only a problem if not alignable to proper camber.
Of course the main determinant of height is the spring system. MB gives four rubber cushion thicknesses (four different part #s from 8mm to 23mm) to correct height problems. Its a very uncommon procedure and is usually a cover for a sagged spring which should be replaced (in pairs). This kind of problem doesn't occur naturally till the later stages of a cars life (depending on driving conditions 200-300k or more I would think - its not a problem)
Owner 24 bay BSC
Bosch Master, ASE master L1
26 years MB technician