The 1985 300D is the only w123 model to use a Klima relay to engage the compressor. You might want to visually look at the compressor to make sure it is engaging when the AC is on. The Klima relay is located on the top of the left fenderwell. Quite often the relay will overheat and shut down the compressor. If that happens remove the relay and cool it with a damp cloth and more often than not the compressor will start up. If this is not the problem, more than likely the problem is the monovalve. Clean and check the electrical terminals on the monovalve first, they often get corroded. Unfortunately most of the repair kits for monovalves are not very good and often the electromagnet in the valve goes bad that a kit will not repair. You can remove the top of the monovalve and check to see if the rubber diaphram is intact. If not, get a repair kit and give it a try. The auxillary water pump circulates water through the heater - however, if the pump goes bad it can cause a malfunction in your pushbutton dash controls. The aux pump should have an inline 2 amp fuse installed to prevent a problem with the pushbutton unit.

I would personally try to get a used monovalve from a wrecked car and give it a try.