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Here is my take on the subject (having converted four cars so far) I will use my W201 as a test case.
Larry is right, the R134 coolant/oil is not kind on the stock evaps, given that, it should be replaced for one of the updated units. The AC filter does need to be replaced as well. As for O Rings, the stock, MB updated rings work fine (although I bet they are designed for R134 retrofits) so pick up the new O Rings at the local MB dealer and replace them all.
The Wal Mart kits mentioned here are actually good kits, they include a pressure guage, pre-mixed coolant/oil and R134 adapter fittings. The R134 oil can co-exist with the R12 oil but a good rule of thumb is to drain as much of the R12 oil out as you can. The 80% fill ratio is accurate as R134 is a higher pressure coolant than R12.
On my W201, I replaced all the O rings, AC filter, AC filter sensor (was bad) evaporator (newer design) and new condenser. Replacing these components addressed the majority of the R12 oil left in the system. I filled my system to 80% capacity and added a can of Maxi-Cool, which as I understand it, is suppose to increase cooling of the R134.
I did this over two years ago and my system at full (with recirc on) blows right around 45-47 degrees and I have had no issues to date.
To sum this up, I was at my local MB dealer about a year ago and a gentleman came in for a R134 retro on a W124, the dealer charged him $1200 for this. I happened to be waiting right by a window into the shop, the W124 pulled into the stall where I was sitting. The MB tech evacuated the R12, drained the R12 oil from the compressor (or so it appeared) replaced the AC filter and replaced one AC line and some O rings (not sure how many) and then charged it up with R134, tested pressure and measured functional temp and he was done. Pretty interesting.
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