It could be a head gasket leak, but I would be more inclined to believe it's the infamous U-gasket leaking.
If so, this problem is fixed using MB service task 01-212 - Removing, installing the top front cover.
The task is in the 103 engine manual(paper) or the 124/126 CD-Rom - 103 engine.
A diyer with reasonably good skills can handle this.
1991 300-SEL - Model 126
M103 - SOHC
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