Thanks Gilly for that detailed response! I was using the SEARCH button earlier and did some reading about the "lip seal" as you call it and it I think that might be my problem. I will check to confirm as soon as possible.
My car has a little under 120,000 miles on it. I changed the spark plugs approximately 2000 miles ago. The plugs that were in the car looked like new. My mechanic said that they looked like they had 6000 miles on them at most. I changed the oil too and it was clean. I'm using Liqui Moly 10W40. When I went to change the air filter, I found a K&N filter which was also clean. I wonder if my valve stem seals need to be replaced.
I have most of the service records for my car. I am missing some of the last ones and you can see them in this thread. Look at post #12:
Just Bought a W124 300ce