Oil in the coolant is a classic 124 problem and there was a post on it a couple of weeks ago that explains it in detail. I offered to host a DIY session in my garage, but the problem car was in CT.

You are at risk driving the car because the oil eats away at the cooling system hoses.

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Chuck Taylor
Falls Church VA
'66 200, '66 230SL, '96 SL500. Sold: '81 380SL, '86 300E, '72 250C, '95 C220, 3 '84 280SL's '90 420SEL, '72 280SE, '73 280C, '78 280SE, '70 280SL, '77 450SL, '85 380SL, '87 560SL, '85 380SL, '72 350SL, '96 S500 Coupe