Now ain't that sumthin! I sure would have started with the turbo, I've seen several blowing huge clouds of blue smoke due to ruined bearings, but I'd never have guessed a blown head gasket sucking oil out of the chaine case!
Guess I'd better have a closer look at the 220 D this week, wonder if I don't have a similar head gasket problem. Hmm. I'm pretty sure that's what has happened to the Volvo, too (also known for head gasket failures!)
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!