There is some thinking that non-OEM filters contribute to the demise of your Air Mass Meter, and if your car is under warranty, you may have difficulty having the part replaced as you added a non-OEM part. The AMM for the car is >$500.
The K&N will not provide any performance improvement over the OE filter. Also, the OE filter is quite inexpensive, so the long term costs of replacing vs. cleaning are not as far apart as they used to be.
For 99% of new cars, they make little sense. However, if you do some exhaust and head flow improvement work, then you might need some additional flow. But, I have read about supercharged CLK430's making 500hp and using the stock intake ducting.
1998 C230 "Black Betty"