There are few difference other than the Engine, the 560 has Hydraulic rear suspension which would be nice for towing a trailer but it is very expensive to fix once it fails.
560 also has warming seats, and reclining back seat.
The wood panneling is superior than standard 420.
May be some body else can add to the list, but these are the differnces in both cars. And obviously, 560 does 13-17mpg while 420 do 16-21 mpg.
If you are in LA area, I am selling my Gold 1987 420SEL , it has 137K miles on it. If interested send me a PM.
87 420 SEL
Looking for a nice mid 80's MB diesel.
87 BMW 528e (Sold)
99 TOYOTA 4Runner
1989 Honda Accord (Sold)
1988 Honda Accord (Total)