I would suspect that the previous owner/s didn't change the oil frequently.... The chain is SERIOUSLY worn and must be replaced pronto.
However, you do have a very lucky car -- that missing piece is sitting safely in the oil pan, and it DIDN'T go where it usually does -- down between the chain and the sprokets! You have avoided, by the skin of your teeth, the typical broken chain/valve job -- about $4000 if done by a shop!
You need a new rail to replace the broken one and a new chain. The new chain should fix up the rough idle, etc. The noise is the chain slapping because you are out of tensioner travel. You might also want to replace the tensioner just to be safe.
Sadly, I would also recommend doing a compression check -- it is possible the valves on the right side are touching the pistons!
1972 220D ?? miles
1988 300E 200,012
1987 300D Turbo killed 9/25/07, 275,000 miles
1985 Volvo 740 GLE Turobodiesel 218,000
1972 280 SE 4.5 165, 000 - It runs!