Trouble prone...probably...some people,and I emphasize some,have had had problems...I had a complete engine installed at 102K...but I have seen cars with over 200K and no problems. It seems that whatever upgrades they put into the new engines have solved the problem(if there was one I guess)In terms of the soot/smoke issue none of the 90's diesel cars are not going to smoke like the older ones...also they will be much smoother,peppier and smoother.
Compared to the 1985 300SD I had the 1992 model is a huge difference.
As for the S320 you should notice acceleration differences from a dead stop....midrange range passing will probably be similiar...but you will notice more on the top end/top speed with the S320....but on the flipside your fule mileage will be much less and the maintenence will be more

Warren Turner
1992 300SD 110K