Higher temps are normal, especially in slow traffic with the AC on.
Aux fan is two speed -- AC receiver/dryer switch (pressure, not temp finally) goes through a resistor, so you have low speed with AC. Engine temp sensor "switch" (actually a thermistor that goes very high resistance) switches high speed.
The contacts on the resistor tend to corrode --its up by the headlight on the 300D -- and that can keep the fan from running via the AC switch.
Visco clutch should lock up at about 90 C ambient, release at 85 or so (may be 5 degrees higher) -- coolant temp will be around 100.
The newer heads are MUCH less likely to crack than the older ones.
1972 220D ?? miles
1988 300E 200,012
1987 300D Turbo killed 9/25/07, 275,000 miles
1985 Volvo 740 GLE Turobodiesel 218,000
1972 280 SE 4.5 165, 000 - It runs!