I agree with Mike in replacing only the valve stem seals. The rubber seals get brittle and crack or the sealing lip wears and that is what causes oil to leak into the cylinders. The seals can be replaced without removing the head and parts will probably be less than $20.
I replaced the valve stem seals on my '92 300e and oil consumpion went down from a quart in 750 miles to a quart in 2000 plus miles. I also replaced them in my '88 260e and the results were not so dramatic but still a great improvement.
You noted that 20-50 oil was used in the engine. I have found that the grade of oil really doesn't make much difference as far as consumption is concerned.